Documents released yesterday show the Australian government has been advised several new bank taxes might be justified.A report sent to Treasury Secretary Ken Henry on 7 October 2010 said "it can be argued that there is a strong case for charging the banking sector for the implied systemic guarantee provided by the public sector".It pointed out that Sweden had implemented a tax on bank liabilities (excluding deposits) in order to create a bailout fund, and that the UK had by last October introduced a tax on bankers' bonuses. The UK has since introduced an additional tax on bank liabilities.It also raised the possibility that banks could be taxed based on "perceived" excessive profits. In this case, the report said, "a tax based on excess rents would be most appropriate". That suggests a tax based on profits above a certain threshold, although the paper did not make this explicit.Other documents suggest the Treasury has been more enthusiastic about altering the existing tax system's pro-debt biases than on imposing a new banking tax.The documents were disclosed to Daily Telegraph reporter Steve Lewis in response to a Freedom of Information Act request.There is no direct evidence that the government is planning a bank tax, and Treasurer Wayne Swan last June opposed a G20 proposal for a global bank levy.However, the government faces continued pressure to balance its budget by 2012-13, and a tax on banks could be politically popular at a time when they are widely seen as too profitable.Treasury's documents also underscore the commercial value of the government's long-standing undertakings to protect the stability of the financial system.The government must this year decide on how to extend the Financial Claims Scheme, the government guarantee designed to protect bank depositors if banks fail. The scheme expires in October; the government has committed to put a permanent scheme in place.However, the papers have pointed out that the scheme is a relatively inexpensive measure compared to the possible cost of the government's general undertaking to maintain financial stability.The Australian Bankers Association was reported today as saying it was unlikely the government would impose a new bank tax, and that Australian banks made big profits because they were big businesses. A memo sent to Ken Henry and senior Treasury officials Jim Murphy and Nigel Ray says banks could be charged as part of the Financial Claims Scheme.But one of the Treasury papers says the Financial Claims Scheme is not an appropriate vehicle for charging the financial sector:- A charge tied to the Financial Claims Scheme would raise only marginal revenue if levied at an actuarially appropriate level.- The Financial Claims Scheme mainly affects the timing of delivery of funds, by providing immediate access. Most funds covered by the scheme would be eventually recovered in a liquidation.- The Financial Claims Scheme covers only a quarter of all bank liabilities.- A charge tied to the Financial Claims Scheme could encourage banks to rely less on deposits and more on wholesale funds.Thanks to the Daily Telegraph for the three documents,