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 The Retirement Savings Account Levy Imposition Determination 2018 is repealed upon commencement of this determination.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.
Overview
The Retirement Savings Account Providers Supervisory Levy Imposition Determination 2019 was enacted to regulate the imposition of a supervisory levy on retirement savings account providers (RSA providers) as stipulated by the Retirement Savings Account Providers Supervisory Levy Imposition Act 1998. This Act was introduced to address the need for financial oversight and regulatory compliance within the retirement savings sector. The determination, which commenced on 1 July 2019, specifies the levy parameters for the 2019-20 financial year, including the restricted and unrestricted levy percentages, which in this instance are both set at zero percent, effectively exempting RSA providers from any levy for that year. The determination was made by the Treasurer in accordance with the Act and is a legislative instrument under the Legislation Act 2003. The enactment body was the Australian Parliament, and the policy objective appears to be ensuring that RSA providers remain compliant with regulatory requirements without financial burden for the specified financial year.
Scope and Application
The Retirement Savings Account Providers Supervisory Levy Imposition Determination 2019 applies to RSA providers, who are subject to the provisions of the Retirement Savings Account Providers Supervisory Levy Imposition Act 1998. The determination sets out the levy amounts for the 2019-20 financial year and effectively imposes a zero percentage levy for both restricted and unrestricted components, meaning RSA providers are not levied directly for this financial year. The determination also repeals the previous levy imposition for the 2018-19 financial year and ensures that any obligations or liabilities from prior years remain valid. The scope of the Act is confined to financial obligations and does not extend to other areas of conduct or transactions outside of the financial sector, specifically retirement savings accounts. The determination is a legislative instrument under the Legislation Act 2003 and does not require a Regulatory Impact Statement as it is deemed machinery-of-government in nature. The Act applies across the Commonwealth of Australia, with no specific exclusions or exemptions mentioned in the text.
Key Provisions
The Retirement Savings Account Providers Supervisory Levy Imposition Determination 2019 (the Determination) outlines the specific parameters of the levy imposed on retirement savings account (RSA) providers for the 2019-20 financial year under the Retirement Savings Account Providers Supervisory Levy Imposition Act 1998 (the Act). According to section 7(3) of the Act, the Determination sets the maximum and minimum restricted levy amounts, the restricted and unrestricted levy percentages, and how the levy base for RSA providers is calculated. For the 2019-20 financial year, the restricted levy is set at zero per cent of assets, with a minimum amount of $0 and a maximum amount of $0. Similarly, the unrestricted levy is also set at zero per cent. Essentially, this means RSA providers will not be subject to a levy for this financial year.
RSA providers governed by this Determination must adhere to the specified percentages and calculations for their levy base. While the levy is set at zero per cent for 2019-20, providers are required to ensure their records and calculations align with the parameters set by the Determination. This includes maintaining accurate records of their assets and any related computations necessary for compliance.
There are no specific offences or penalties outlined in the Determination for the 2019-20 financial year as the levy amount is zero. However, RSA providers must still comply with the requirements of the Determination to avoid potential repercussions in future financial years. Non-compliance with the Act or the Determination could lead to administrative or legal consequences, including fines and other penalties as prescribed by the Act. The Determination clarifies that obligations or liabilities incurred in previous financial years remain valid, underscoring the importance of consistent adherence to the Act’s provisions.
The Determination also includes a statement of compatibility with human rights, affirming that the legislative instrument does not engage any of the applicable rights or freedoms as recognised in the international instruments listed in the Human Rights (Parliamentary Scrutiny) Act 2011. This statement ensures that the Determination is consistent with human rights obligations.