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Australian parliament okays levy on 5 top banks

The Australian parliament has cleared a proposal by the government to impose a levy to raise $6 billion from Australia’s five biggest banks. The levy, announced in the May budget, passed the upper house with the support of Labor and the Greens. It will apply to ANZ, Westpac, National Australia Bank, Commonwealth and Macquarie and is expected to raise $6.2 billion, including $1.6 billion in the first year. The government, however, agreed to a request by the banks to undertake a review on the levy in 2 years. The government had appointed a committee in this regard, which recommended the measure. The committee also said the legislation should also be amended to allow the treasurer to suspend the levy in cases where banks are in extreme financial hardship. Finance minister Mathias Cormann said the levy would apply to foreign banks if they were ever to meet the threshold but at present, none fit the ‘major bank’ category. There was strong opposition not just from the banks but from legislators too against the levy.

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