EXPLANATORY STATEMENT

Retirement Savings Account Levy Imposition Determination 2007

This determination relates to a levy imposed on providers of retirement savings accounts by the Retirement Savings Account Providers Supervisory Levy Imposition Act 1998.

This determination commences on 1 July 2007 and relates to the 2007‑08 financial year.  The Retirement Savings Account Providers Supervisory Levy Imposition Determination 2006 is revoked upon commencement of this determination.  Consistent with section 50 of the Acts Interpretation Act 1901, any obligation or liability incurred in previous financial years remains valid.

Subsection 7(3) of the Retirement Savings Account Providers Supervisory Levy Imposition Act 1998 allows the Minister to determine;

(a)          the maximum restricted levy amount for each financial year;

(b)          the minimum restricted levy amount for each financial year;

(c)          the restricted levy percentage for  each financial year;

(ca) the unrestricted levy percentage for each financial year; and

(d)          how a retirement savings account provider’s asset value is to be calculated.

This determination provides that the restricted component for the 2007‑08 levy will be calculated at 0 per cent of assets held by the entity, subject to a minimum amount of $0 and a maximum amount of $0.  The unrestricted component of the 2007-08 levy will be calculated at 0 per cent of assets held by the entity. 

In effect, this means that RSAs will not be levied directly in relation to the 2007‑08 financial year.  However, consistent with the Government’s acceptance of the recommendations of the Review of Financial Sector Levies, RSAs offered by authorised deposit‑taking institutions or entities in other sectors are being taken into account in the 2007‑08 levies for those sectors according to the sector classification of the RSA provider.

The finance sector has been consulted on the 2007‑08 supervisory levies through a Treasury and Australian Prudential Regulation Authority discussion paper released on 25 May 2007.

This determination is a legislative instrument for the purposes of the Legislative Instruments Act 2003.