Greens tax grab ‘insidious populism’, says CBA boss Matt Comyn

CBA boss Matt Comyn has lashed the Greens’ proposed $514bn ‘Robin Hood’ tax on major corporations as an exercise in ‘insidious populism’.

Commonwealth Bank chief executive Matt Comyn appearing before the standing committee on economics on Thursday. Picture: NewsWire / Martin Ollman

Commonwealth Bank boss Matt Comyn has lashed the Greens’ proposed $514bn “Robin Hood” tax on major corporations as an exercise in “insidious populism”, arguing the party has overlooked the positive contribution made by big business in boosting employment and wealth creation.

Speaking before the standing committee on economics on Thursday, the head of the nation’s largest retail bank also made the case for broader tax reform and warned that governments had ­become too reliant on income tax – comments echoed by Westpac chief executive Peter King.

Leading economist Saul ­Eslake said he didn’t blame Labor for not pursuing tax reform this term because Anthony ­Albanese had promised not to, but he ­argued the government was now at the “most ideal moment i the electoral cycle for reform” as it sought a mandate for a second term.

“What’s disappointing is that there’s no effort being made to seek a mandate for tax reform at the next election,” he said. “And if they don’t get one this time, by the time 2028 comes around … they’ll be looking tired.”

Mr Comyn used his appearance to defend the major banks, pushing back against criticism ­relating to charges imposed for credit card payments. He rejected the notion that the bank’s profits were “somehow unjustly extracted from consumers”.

He said the banks and other businesses were being subject to “claims that are not demonstrably true” and that it was unfair for people to perpetuate criticism of businesses that was “factually ­incorrect”.

After Greens leader Adam Bandt used an address to the ­National Press Club this week to unveil a plan for a 40 per cent tax on companies’ “excessive profits” to fund cost-of-living measures, Mr Comyn said the minor party’s plan ignored the “beneficial elements which businesses and large corporations make”.

“We are a reasonably large company,” he said. “We employ 50,000 people and we have paid out $8bn in dividends.”

Mr Comyn said the idea of imposing a super-profit tax of up 40 per cent was “based on the (belief) there is some pool of assets and capital which can be tapped whenever it is convenient, and there will be no consequences”.

“It is based on a false dichotomy that there is somehow something that is unjust about it – that profit has been unjustifiably ­extracted and, for some reason, that shouldn’t be so.”

He said he supported the need for tax reform, which relied less on income tax and more on wealth. “The tax system, at the moment, is not as efficient and as fair as it could be,” he said in response to questions by NSW independent MP Allegra Spender. “We are over relying on income (taxes).”

“I don’t think we are taxing wealth as heavily as we could … It is part of a broader structural issue which needs to be addressed.”

Mr Comyn understood that any changes to the tax system would be unpopular, but said that over time tax reform would be a “critical structural reform that will be necessary to drive continued prosperity and productivity”.

Mr King, the Westpac boss, said tax reform was “always hard” but “we’re probably, as a country, too dependent on income tax”. “Consumption taxes can do a little bit more harder work, and then how we think about assets and wealth and whatnot is ­another area,” he said. “But good luck to the parliament on that one.”

The latest Intergenerational Report, released in August 2023, found that, in the absence of policy change, personal income tax receipts were projected to grow from 50.5 per cent of total tax ­receipts in 2022–23 to 58.4 per cent in 2062–63.

It also forecast that personal income tax receipts were forecast to rise from 11.7 per cent of GDP in 2022-23 to 13.5 per cent of GDP by 2033–34 and then to 14.3 per cent of GDP by 2062-63.

Mr Eslake told The Australian that he applauded the comments from Mr Comyn and “his recognition that our tax system taxes income too much and wealth not enough”. He said Australia’s income tax and social security systems had done quite a good job in preventing inequality in the distribution of income.

But he said it had failed to prevent a significant widening of inequality in the distribution of wealth, not so much between the wealthiest and the poorest, but between the old and the young.

“Over the period between 2003-04 and 2019-20 … over that period of 16 years, the share of wealth owned by households aged 55 and over rose by 13.1 percentage points. And the share owned by households aged between 25 and 55 fell by 13.1 percentage points. That’s an enormous change in a short period of time,” he said.

Mr Eslake suggested several changes, including replacing stamp duty with a broad-based land tax that included the family home. He also said he had no “philosophical problem with death duties”. “You need to set a threshold high and you need to index it,” he said. “If you had an inheritance tax with a threshold of $5m or $10m and you indexed it, I don’t have a problem with that at all.” Mr King told the hearing on Thursday that there was a need to look at stamp duty reform on ­affordable housing, arguing that he was “really worried about our ability to build enough houses”.

“When I talk to the developers, they’re pretty much focused on the premium end of the market at the moment, because that’s where they can make money,” he said. “And affordable housing is something that doesn’t make sense at the moment. If the market’s left to solve ­itself, I think it’s going to take a long time.”