{"id":"C2017A00063","name":"Major Bank Levy Act 2017","slug":"major-bank-levy-act-2017","collection":"act","jurisdiction":"commonwealth","status":"in_force","isInForce":true,"actNumber":"63 of 2017","makingDate":null,"administeringDepartment":null,"currentVersion":{"id":8589,"registerId":"commonwealth-C2017A00063-current","compilationNumber":null,"startDate":"2026-03-30","status":"InForce","reasons":null,"registeredAt":null},"sections":[{"sectionNumber":"1","sectionType":"section","heading":"Major Bank Levy Act 2017","content":"---\nmeta-content-style-type: text/css\nmeta-content-type: application/xhtml+xml; charset=utf-8\n---\n\n?xml version=\"1.0\" encoding=\"utf-8\" standalone=\"no\"?>\n\n![](image.001.png)\n\n \n\n \n\n \n\n \n\n \n\n \n\nMajor Bank Levy Act 2017\n\n \n\nNo. 63, 2017\n\n \n\n \n\n \n\n \n\n \n\nAn Act to impose a levy on certain authorised deposit‑taking institutions, and for related purposes\n\n \n\n \n\n \n\nContents\n\n1 Short title\n\n2 Commencement\n\n3 Definitions\n\n4 Imposition of levy\n\n5 Amount of levy\n\n6 Working out amounts for a quarter\n\n7 Amounts to be worked out in accordance with accounting principles etc.\n\n8 Minister may determine methods of working out amounts\n\n \n\n![](image.001.png)\n\n \n\n \n\nMajor Bank Levy Act 2017\n\nNo. 63, 2017\n\n \n\n \n\n \n\nAn Act to impose a levy on certain authorised deposit‑taking institutions, and for related purposes\n\n[Assented to 23 June 2017]\n\nThe Parliament of Australia enacts:\n\n1  Short title\n\n  This Act is the Major Bank Levy Act 2017.\n\n2  Commencement\n\n (1) Each provision of this Act specified in column 1 of the table commences, or is taken to have commenced, in accordance with column 2 of the table. Any other statement in column 2 has effect according to its terms.\n\n \n\n- Commencement information\n- Column 1 Column 2 Column 3\n- Provisions Commencement Date/Details\n- 1. The whole of this Act The day after this Act receives the Royal Assent. 24 June 2017\n\n\nNote: This table relates only to the provisions of this Act as originally enacted. It will not be amended to deal with any later amendments of this Act.\n\n (2) Any information in column 3 of the table is not part of this Act. Information may be inserted in this column, or information in it may be edited, in any published version of this Act.\n\n3  Definitions\n\n  In this Act:\n\nADI (authorised deposit‑taking institution) means a body corporate that is an ADI for the purposes of the Banking Act 1959.\n\nADI financial claims scheme means the scheme provided for under Division 2AA of Part II of the Banking Act 1959.\n\napplicable liabilities amount for a quarter has the meaning given by subsection 5(2).\n\napplicable reporting standard means a standard that:\n\n (a) is determined by the Australian Prudential Regulation Authority under section 13 of the Financial Sector (Collection of Data) Act 2001; and\n\n (b) relates to reporting amounts for the purposes of this Act (whether or not it also relates to other matters).\n\nlevy threshold for a quarter has the meaning given by subsection 4(3).\n\nquarter means a period of 3 months ending on 31 March, 30 June, 30 September or 31 December.\n\ntotal liabilities amount for a quarter has the meaning given by subsection 4(2).\n\n4  Imposition of levy\n\n (1) Levy is imposed on an ADI for a quarter starting on or after 1 July 2017 if the total liabilities amount for the quarter in relation to the ADI exceeds the levy threshold for the quarter.\n\n (2) The total liabilities amount for a quarter in relation to an ADI is the amount equal to the total liabilities of the ADI for the quarter, as reported under an applicable reporting standard.\n\n (3) The levy threshold for the quarter starting on 1 July 2017 is $100 billion. The amount is indexed quarterly.\n\nNote: Subdivision 960‑M of the Income Tax Assessment Act 1997 shows how to index amounts.\n\n5  Amount of levy\n\n (1) The amount of the levy payable by the ADI for the quarter is 0.015% of the applicable liabilities amount for the quarter in relation to the ADI.\n\n (2) The applicable liabilities amount for the quarter in relation to the ADI is the difference between:\n\n (a) the total liabilities amount for the quarter in relation to the ADI; and\n\n (b) the sum of the following amounts:\n\n (i) the total Additional Tier 1 Capital for the quarter in relation to the ADI, as reported under an applicable reporting standard;\n\n (ii) the total amount of deposits held, to the extent that they would be protected by the ADI financial claims scheme, for the quarter in relation to the ADI, as reported under an applicable reporting standard;\n\n (iii) an amount equal to the lesser of the derivative assets for the quarter in relation to the ADI and the derivative liabilities for the quarter in relation to the ADI, both as reported under an applicable reporting standard;\n\n (iv) the exchange settlement account balance, held with the Reserve Bank of Australia, for the quarter in relation to the ADI, as reported under an applicable reporting standard;\n\n (v) any amounts of a kind determined under subsection (4).\n\n (3) The methods for working out any of the amounts mentioned in paragraph (2)(b) may be set out in the same applicable reporting standard (including the standard mentioned in subsection 4(2)).\n\n (4) The Minister may, by legislative instrument, determine a kind of amount for the purposes of subparagraph (2)(b)(v).\n\n (5) An instrument made under subsection (4) may make provision in relation to a matter by applying, adopting or incorporating any matter contained in any other instrument or writing as in force or existing from time to time.\n\n (6) Subsection (5) has effect despite anything in subsection 14(2) of the Legislation Act 2003.\n\n6  Working out amounts for a quarter\n\n (1) An amount mentioned in subsection 4(2) or paragraph 5(2)(b) for a quarter is to be worked out by working out that amount as at the end of the last day of the quarter.\n\n (2) However, the following amounts for a quarter are to be worked out under subsection (3):\n\n (a) the total liabilities amount, to the extent that it consists of liabilities relating to any of the following:\n\n (i) debt securities;\n\n (ii) repurchase agreements;\n\n (iii) loans between the ADI concerned and another ADI;\n\n (iv) loans between the ADI concerned and a foreign bank (within the meaning of section 128A of the Income Tax Assessment Act 1936);\n\n (b) the exchange settlement account balance mentioned in subparagraph 5(2)(b)(iv);\n\n (c) an amount of a kind determined under subsection (4).\n\n (3) An amount mentioned in subsection (2) is worked out, for a quarter, as follows:\n\nMethod statement\n\nStep 1. For each day during the quarter, work out the amount mentioned in subsection (2) as at the end of that day.\n\nStep 2. Add together the step 1 amounts.\n\nStep 3. Divide the step 2 amount by the total number of days in the quarter.\n\n (4) The Minister may, by legislative instrument, determine a kind of amount for the purposes of paragraph (2)(c).\n\n (5) An instrument made under subsection (4) may make provision in relation to a matter by applying, adopting or incorporating any matter contained in any other instrument or writing as in force or existing from time to time.\n\n (6) Subsection (5) has effect despite anything in subsection 14(2) of the Legislation Act 2003.\n\n7  Amounts to be worked out in accordance with accounting principles etc.\n\n  An amount mentioned in subsection 4(2), paragraph 5(2)(b) or subsection 6(2) for a quarter is to be worked out in accordance with:\n\n (a) accounting principles (within the meaning of the Income Tax Assessment Act 1997); and\n\n (b) any applicable instrument made under section 8.\n\n8  Minister may determine methods of working out amounts\n\n (1) The Minister may, by legislative instrument, provide for any matter relating to the method for working out an amount mentioned in subsection 4(2), paragraph 5(2)(b), or subsection 6(2).\n\n (2) An instrument made under subsection (1) may make provision in relation to a matter by applying, adopting or incorporating any matter contained in any other instrument or writing as in force or existing from time to time.\n\n (3) Subsection (2) has effect despite anything in subsection 14(2) of the Legislation Act 2003.\n\n \n\n \n\n \n\n \n\n[Minister’s second reading speech made in—\n\nHouse of Representatives on 30 May 2017\n\nSenate on 19 June 2017]\n\n \n\n(115/17)\n\n \n","sortOrder":0}],"analysis":{"kimi_summary":{"content_quality":"ok","complexity_score":4,"scope_assessment":{"changed":false,"description":"The legislation remains tightly focused on its original purpose: imposing a quarterly levy on major banks with liabilities exceeding $100 billion. The scope has not expanded beyond this targeted tax measure on systemically important ADIs."},"complexity_factors":["8 defined terms in section 3, including nested references to external legislation (Banking Act 1959, Financial Sector (Collection of Data) Act 2001)","Multi-step calculation methodology requiring subtraction of 5+ specific liability categories from total liabilities","Dual timing regimes: most amounts use quarter-end measurement, but specific items (debt securities, interbank loans, exchange settlement balances) require daily averaging across the quarter","Extensive delegation of technical detail to Ministerial legislative instruments (sections 5(4), 6(4), and 8(1))","Incorporation by reference of external standards (APRA reporting standards) and accounting principles (Income Tax Assessment Act 1997)","Cross-references to 4 other Acts: Banking Act 1959, Financial Sector (Collection of Data) Act 2001, Income Tax Assessment Act 1936, Income Tax Assessment Act 1997, and Legislation Act 2003","Indexed threshold requiring quarterly adjustment calculations under tax law indexing provisions"],"plain_english_summary":"This law introduces a **tax on Australia's biggest banks** — specifically, those with total liabilities (debts and obligations) over $100 billion. This threshold is adjusted for inflation each quarter.\n\n**Who pays:**\n- **Authorised deposit-taking institutions (ADIs)** — these are banks and other financial institutions licensed to accept deposits from customers (like Commonwealth Bank, Westpac, NAB, ANZ, and Macquarie).\n- Only those with **total liabilities exceeding $100 billion** (indexed) must pay.\n\n**How it works:**\n- The levy is charged **quarterly** (every 3 months).\n- The rate is **0.015%** of the bank's \"applicable liabilities amount.\"\n- This amount is calculated by taking the bank's **total liabilities** and subtracting certain protected items:\n  - **Additional Tier 1 Capital** (a type of high-quality bank capital that absorbs losses);\n  - **Protected deposits** (deposits covered by the government guarantee, currently up to $250,000 per account holder);\n  - **Net derivative positions** (the smaller of derivative assets or liabilities — essentially netting out hedging positions);\n  - **Exchange settlement balances** (funds held with the Reserve Bank of Australia);\n  - Any other amounts the Minister determines by regulation.\n\n**Special calculation rules:**\n- Most amounts are measured at the **end of the quarter**.\n- However, certain items — like debt securities, loans between banks, and exchange settlement balances — must be calculated as a **daily average** across the quarter (added up each day and divided by the number of days).\n\n**Why it matters:**\nThis law ensures the largest banks — which benefit from implicit government support as \"too big to fail\" — contribute to the budget. It also partially offsets the advantage they have over smaller banks, which pay more for funding. The government estimated this would raise several billion dollars annually.\n\n**Ministerial discretion:**\nThe Treasurer (Minister) can make regulations to determine additional deductions from the levy base and specify calculation methods, providing flexibility to address technical banking issues without amending the Act."},"flash_summary":{"complexity_score":6,"scope_assessment":{"changed":false,"description":"The Act, as presented, remains narrowly focused on imposing a levy on very large ADIs and setting out how to calculate it. The principal mechanisms (threshold, deductible items, daily averaging, delegated measurement rules) are all directly related to that single purpose. While the Minister's power to determine additional deductible kinds of amounts and to incorporate external material by reference creates flexibility that could alter measurement detail over time, there is no indication in the text that the statute has grown beyond its original, narrowly defined aim of levying large ADIs."},"complexity_factors":["Relatively short Act (8 substantive sections) but several cross‑references to other Acts (Banking Act 1959; Financial Sector (Collection of Data) Act 2001; Income Tax Assessment Act 1997; Legislation Act 2003)","7–8 defined terms in s 3 that materially affect scope (ADI, applicable reporting standard, quarter, total liabilities amount, applicable liabilities amount, levy threshold, ADI financial claims scheme)","Calculation involves nested steps: gross total liabilities, specific deductions, then application of a small percentage (s 5(2)–(3))","Daily averaging rule for a subset of items across each quarter (s 6(2)–(3)), adding computational and data‑collection burden","Indexation mechanism for the threshold (quarterly indexing) referencing tax law rules (s 4(3))","Significant delegated rule‑making: APRA reporting standards and multiple ministerial legislative instruments (s 3 definition, ss 5(4)–(6), 6(4)–(6), 8) including incorporation by reference","Accounting standards requirement plus possible additional instruments governing measurement (s 7)","Potential interaction with prudential capital instruments and derivatives accounting — practical complexity for banks' balance‑sheet modelling"],"plain_english_summary":"The law levies a quarterly charge on very large authorised deposit‑taking institutions whose reported total liabilities exceed an indexed threshold, calculated at 0.015% of an “applicable liabilities” base after specified deductions. APRA and the Treasurer set reporting and measurement details, so the levy raises Commonwealth revenue, concentrates cost on the biggest banks, and creates incentives for those ADIs to alter liability and capital structures to reduce their taxable base."},"flash_summary_failed":{"failed":true,"reason":"A positive credit balance is required for all requests, including BYOK, so fallback providers remain available. Add credits at https://vercel.com/d?to=%2F%5Bteam%5D%2F%7E%2Fai%3Fmodal%3Dtop-up to continue.","source":"analysis-cron"}},"importantCases":[],"_links":{"self":"/api/acts/major-bank-levy-act-2017","history":"/api/acts/major-bank-levy-act-2017/history","analysis":"/api/acts/major-bank-levy-act-2017/analysis","conflicts":"/api/acts/major-bank-levy-act-2017/conflicts","importantCases":"/api/acts/major-bank-levy-act-2017/important-cases","documents":"/api/acts/major-bank-levy-act-2017/documents"}}