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Banks back Business SA's new wave of tax attacks

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Business SA has doubled down on its bank tax attack in the face of Labor critiques, and is poised to unleash a new wave of propaganda – with financial support from the big five banks – against the controversial budget measure.

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The state’s chamber of commerce has picked a fight with the State Government over the levy, announced in Treasurer Tom Koutsantonis’ June budget, prompting strong push-back from Labor figures this week.

Premier Jay Weatherill noted the lobby group was “taking money from the banks to actually run their ads for them against our bank levy”, noting it was “not the role for a business organisation” to talk down the state economy.

Former Treasurer Kevin Foley went even further, calling on members to ditch Business SA, which he said was “nothing but a Squawk Box” that was “not taken seriously by either side of politics”.

But Business SA is pushing on with its campaign, which will see it launch its first ever television ads on Sunday.

The organisation is coy about who funded the advertising spend, with its media release noting only that the campaign was “not being funded through ordinary member funds”.

“Our members, including several banks, have come forward to help fund it,” it said.

Business SA CEO Nigel McBride confirmed to InDaily that all five major banks – the Commonwealth, National Australia Bank, Westpac, ANZ and Macquarie – and their industry body the Australian Bankers’ Association had helped fund the campaign “indirectly and directly”.

But he insisted there were “probably several dozen” other businesses “who have come forward to help” but did not want to be identified publicly.

“Some of them are non-members,” he said.

McBride insisted his organisation was not taking sides before a looming election campaign, saying of his sales pitch: “It’s not anti-Government, mate, it’s anti-tax.”

“We’re bipartisan, but we’re not apolitical,” he said.

“We’re going into this because we can’t not challenge it – we believe this is wrong and we believe it’s bad policy.”

But having nailed Business SA’s colours so publicly to the mast, McBride appears aware he may have bridges to mend after March next year.

“I think this Labor Government has every chance of being re-elected, or of forming government as a coalition,” he said.

“We just have a problem with the principle… tax shouldn’t be arbitrary, it shouldn’t be capricious and it shouldn’t be populist.”

He said Business SA would take the same stance if “any industry group got a tax slapped on them without any notice, any consultation and on the most flimsy excuse”.

“If anybody did it – if the Libs did it – we’d have a problem with it.”

McBride argues the scenario is different from the equivalent federal levy, saying the Commonwealth have different tax prerogatives and “did guarantee the banks through the Global Financial Crisis”.

But the state tax, he said, compounded SA’s reputational damage nationally and overseas, adding “sovereign risk” to existing perceptions about high energy prices and low energy security.

With a vulnerable economy, he said, “is this the time to really walk up and tap the biggest guy at the bar on the shoulder and saying let’s have a fight?”

“The Government was being a little naïve if they thought anybody was going to walk away from something like this,” he said.

Koutsantonis told InDaily in a statement that since the bank tax was announced, the state “has secured billions of dollars worth of investments from Liberty House, Tesla, Neoen, SkyCity, SolarReserve, Macquarie Group, BHP and OZ Minerals”.

“Recent economic reports from NAB, ANZ, Commonwealth Bank and Westpac have also showed business confidence, growth and investment is strong in SA,” he said, adding that the levy “will help fund payroll tax cuts and job creation grants for thousands of small businesses”.

“Business SA should be talking up our state for the benefit of hundreds of SA businesses, not talking down our state for the benefit of five east coast banks.

“The banks are desperately trying to protect their super profits… it’s not surprising that the banks themselves are paying for Business SA’s ad campaign.”

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