EXPLANATORY STATEMENT

Retirement Savings Account Providers Supervisory Levy Imposition Determination 2019

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

This determination commences on 1 July 2019 and relates to the 2019-20 financial year. The Retirement Savings Account Levy Imposition Determination 2018 is repealed upon commencement of this determination. Consistent with section 7 of the Acts Interpretation Act 1901, any obligation or liability incurred in previous financial years remains valid. 

Subsection 7(3) of the Act requires the Treasurer, by legislative instrument, to determine:

•                 the maximum restricted levy amount for each financial year;

•                 the minimum restricted levy amount for each financial year;

•                 the restricted levy percentage for  each financial year;

•                 the unrestricted levy percentage for each financial year; and

•                 how an RSA provider’s levy base is to be worked out.

This determination provides that the restricted component for the 2019-20 levy will be calculated at zero 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 2019-20 levy will be calculated at zero per cent of assets held by the entity. 

In effect, this means that an RSA provider will not be levied directly in relation to the 2019-20 financial year.   

The finance sector has been consulted on the 2019-20 supervisory levies through a Treasury and Australian Prudential Regulation Authority (APRA) discussion paper released on the Treasury website on 4 June 2019. The paper discusses potential impacts of the levies on each industry sector and institution regulated by APRA. Six submissions were received during the consultation process, none of which related specifically to the methodology for this levy.

The Office of Best Practice Regulation has previously advised that a Regulatory Impact Statement is not required as supervisory levies are considered machinery‑of‑government in nature. 

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

A statement of compatibility with human rights for the purposes of Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011 is set out in Attachment 1.

Attachment 1

Statement of Compatibility with Human Rights

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

Retirement Savings Account Providers Supervisory Levy Imposition Determination 2019

This Legislative Instrument is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.

Overview of the Legislative Instrument

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

Subsection 7(3) requires the Treasurer to determine:

•                 the maximum restricted levy amount for each financial year;

•                 the minimum restricted levy amount for each financial year;

•                 the restricted levy percentage for each financial year;

•                 the unrestricted levy percentage for each financial year; and

•                 how a RSA provider’s levy base is to be worked out.

Human rights implications

This Legislative Instrument does not engage any of the applicable rights or freedoms.

Conclusion

This Legislative Instrument is compatible with human rights as it does not raise any human rights issues.