Labour govt 2020-23

[Baa_Baa]

Have you any idea how the GST system of credits and debits works? Thought not.

Yes I do, but how the system works is not relevant to this discussion imo, that the cost of GST on fees would be borne by the saver, not the provider. How it's collected and disbursed is not the point.

[Panda-NZ-]

The banks and funds are not charities or concerned with breaking even. These idealistic views you have would just mean the banks and funds would shut shop on Kiwisaver. Buy some shares in the Kiwisaver providers and see if you have the same perspective as an owner of the business, that they should provide a service that is not profitable and only covers its costs.

Where are these huge costs coming in.

Most of these aussie banks offer seperate managed funds, sometimes with lower fees and without the economies of scale and "captive" customers that kiwisaver gives them.

[Bjauck]

It's not often that you are not sure. Shall I phrase it another way? You'd have to be naive to think that the Kiwisaver providers would absorb the GST on the fees that they charge savers, especially when they all said they would load the GST on to the savers fees.

They could introduce maximum fee regulations, but then wouldn’t GST and any other government imposts would still need to be charged extra to that fee? However if the fee is unrealistic as with rest homes and hospitals, with the government imposed maximum contribution rates, many providers will quit if they cannot cross-subsidise from other revenue streams.Some may decide providing loss making KiwiSaver services would lead to other more profitable business.

Edit: Oops This was meant as a reply to a Panda post…

[Blue Skies]

And just where would that GST come from?

Ummm...perhaps from their obscene profits.

Last year the 4 Australian banks hoovered up $5.5 Billion nett profit after tax (NPAT) from NZ. Do you realise how much that is per day!
It's nearing the total profit of our entire NZX50 which made about $7 billion NPAT.
Just 4 Australian owned banks earn about 80% as much as our top 50 largest Public companies combined.

Australian banks are among the most profitable in the world with among the highest margins against us Kiwis.
ANZ (John Key chairman) alone, made nearly $2 Billion in profit.

The Kiwi Saver industry generates over $650 million in fees for very little work, with a large chunk of that going to Australian banks.
And while NZ providers pay GST on fees, there's an explosion of outrage when there's a move to close the loophole Australian providers enjoy to avoid paying us tax.

Ask yourself, if the situation was reversed, would the Australian govt opposition get so frothy about extending NZ such a special privilege putting their own domestic providers at a disadvantage?

What chance does the govt have against such a powerful lobby group & an influential but generally uninformed media.

[Bjauck]

Ummm...perhaps from their obscene profits.

Last year the 4 Australian banks hoovered up $5.5 Billion nett profit after tax (NPAT) from NZ. Do you realise how much that is per day!
It's nearing the total profit of our entire NZX50 which made about $7 billion NPAT.
Just 4 Australian owned banks earn about 80% as much as our top 50 largest Public companies combined.

Australian banks are among the most profitable in the world with among the highest margins against us Kiwis.
ANZ (John Key chairman) alone, made nearly $2 Billion in profit.

The Kiwi Saver industry generates over $650 million in fees for very little work, with a large chunk of that going to Australian banks.
And while NZ providers pay GST on fees, there's an explosion of outrage when there's a move to close the loophole Australian providers enjoy to avoid paying us tax.

Ask yourself, if the situation was reversed, would the Australian govt opposition get so frothy about extending NZ such a special privilege putting their own domestic providers at a disadvantage?

What chance does the govt have against such a powerful lobby group & an influential but generally uninformed media.

Perhaps Kiwi residents find it more profitable after tax to invest in real estate using mortgages supplied by the Aussie owned banks, rather than investing in banks themselves. So it is profitable for Australian bank investors as well as Kiwi real estate investors, in the current fiscal and investment environment in NZ?

[fungus pudding]

Ummm...perhaps from their obscene profits.

GST is added to their fees and is a cost to the consumer only - it is not related in any way to their profits and is not a tax on the business.
A business simply collects it as an agent and hands it over to Govt.

[Baa_Baa]

You do know don’t you that ANZ and Westpac are in the NZX50? So are you including or excluding their profits from your calculations?

Ummm...perhaps from their obscene profits.

Last year the 4 Australian banks hoovered up $5.5 Billion nett profit after tax (NPAT) from NZ. Do you realise how much that is per day!
It's nearing the total profit of our entire NZX50 which made about $7 billion NPAT.
Just 4 Australian owned banks earn about 80% as much as our top 50 largest Public companies combined.

Australian banks are among the most profitable in the world with among the highest margins against us Kiwis.
ANZ (John Key chairman) alone, made nearly $2 Billion in profit.

The Kiwi Saver industry generates over $650 million in fees for very little work, with a large chunk of that going to Australian banks.
And while NZ providers pay GST on fees, there's an explosion of outrage when there's a move to close the loophole Australian providers enjoy to avoid paying us tax.

Ask yourself, if the situation was reversed, would the Australian govt opposition get so frothy about extending NZ such a special privilege putting their own domestic providers at a disadvantage?

What chance does the govt have against such a powerful lobby group & an influential but generally uninformed media.

[Blue Skies]

GST is added to their fees and is a cost to the consumer only - it is not related in any way to their profits and is not a tax on the business.
A business simply collects it as an agent and hands it over to Govt.

Fair call, I know.
Was just making a point about the amount of money they plunder from the NZ economy which is staggering, & they could easily absorb that by reducing their charges & fees.
As am sure you're aware, there's been calls for regulation, look at ANZ how many other companies increased their profits by around 40% during Covid.

[Blue Skies]

You do know don’t you that ANZ and Westpac are in the NZX50? So are you including or excluding their profits from your calculations?

They'll be included.

[Baa_Baa]

They'll be included.

Then that screws up your comparison of bank profits to nzx50 profits