Soft GDP figure should be a wake-up call for government which needs to maintain a strong banking industry and rethink the new tax, the Australian Bankers’ Association (ABA) said.
In the March quarter the economy grew by 1.7 per cent year-over-year and while the finance and insurance industry showed a much stronger four per cent growth.
According to ABA’s chief executive, Anna Bligh, in this environment “the Federal Government’s new tax on major banks was contrary to the national interest".
“The latest inflation figures show that the price of financial services has increased by less than overall inflation, and by much less than some essential items like child care, education, and health,” she said.
“You don’t win the race by knobbling your fastest runners. The government needs to rethink this new tax."