The inevitable flap over who bears the cost of the new levy on wholesale liabilities of five larger banks in the Australian government's 2017 budget is well underway, though our guess yesterday on the redundant aspect of the debate is not as clear.For a start, the ritual protests yesterday by big banks and their CEOs on a tax equivalent to around five per cent their profits evaded the fallacy spruiked by Australia's mining sector when in a similar jam ten years.Costs will be borne by customers and shareholders, a number of CEOs said, almost quoting each other, with the "and shareholders" being the essential aspect.The tax will be an annualised rate of 0.06 per cent applied to a spectrum of wholesale liabilities not covered by the Financial Claims Scheme. A threshold of liabilities of at least $100 billion confines the tax to the five largest banks.The manner in which this levy or tax finally flows through to users of banking services in Australia, and whether it lands on some or all of them, is a wrangle just warming up.If anything, an assumption that this tax or levy must flow through as a cost borne in large part by all customers may warrant a rethink.A liability tax is in fact no novelty in Australian taxation and banking practice. Moreover, the industry has experience with taxes that are not all that different.The bank account debits (or BAD) tax, levied at the federal level, applied from 1982 for close to two years. This was a transaction tax, so tied to the use of cheques and extended to debits (on "cheque" accounts only, not on "savings") via Eftpos as that payments choice flourished.A related tax slapped on banks, beginning in 1982, was the financial institutions duty. FID is much more relevant to considering the new bank levy.FID was "levied on the value of receipts on financial institutions, and on the average daily liabilities of short-term money market dealers", a short history by David Kehl of the Parliamentary Library relates.FID, never applied in Queensland, was thus a tax on liabilities as well as a tax on deposits. FID was also subject to much gaming, bags full of vouchers taxable in one state flown (by some banks, at some stages) each night for processing in Queensland.Revenue raised by FID and BAD tax was A$2.24 billion in 2000.Both bank taxes disappeared as part of the tax reform package of the era that made the goods and services tax a staple of government revenue.Of most relevance is the manner in which most banks opted to manage the new taxes at the time.Overwhelmingly, banks passed this levy on as a direct and transparent cost to their customers - businesses or households - as a simple monthly tax related to their own use of banking services.Thus it may no great challenge to apply this tax to the comparatively small number of customers placing wholesale "deposits" with big banks, that is, the liabilities on which banks must pay the tax.