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National Australia Bank will adjust a range of deposit and lending rates to recover costs associated with the introduction of the Goods and Services Tax.
The National's Chief Executive Officer, Australian Financial Services, Mr Mike Pratt, said: "The National, along with all banks, faces increased costs as a result of the new tax system due to the input taxed classification of most of its products and services.
"In making these interest rate adjustments the National has taken into account expected cost reductions as a result of the abolition or reduction in taxes and duties paid or payable by the Bank. The National is only passing on increased costs related to GST and has not increased profit margins," Mr Pratt said.
The changes seek to recover:
the increased costs due to GST paid on most of the purchases associated with the delivery of its core products and services; and
the cost of implementing the Goods and Services Tax.
The standard variable housing loan rate will increase by 0.01% from 7.80% to 7.81%. Business variable lending rates will increase by 0.10% per annum.
Other Personal and Business lending and deposit rates are also to be adjusted by up to 0.12%.
The new rates will be effective from 31 July 2000. The changes follow full consultation with the Australian Competition and Consumer Commission and are within the Commission's guidelines.
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