GST may extend to banks, raise $27bn

Financial services may lose their GST exemption under a plan currently under review by the Turnbull government, The Australian Financial Review reports.

Such a move would raise $18 billion over the next four years -- assuming the GST rate holds at 10 per cent -- and potentially be used to fund a cut to the 30 per cent corporate tax rate.

"Reconsidering the GST exemptions should be a priority agenda item as we embark on further tax reform," Liberal MP Dan Tehan wrote in the AFR.

"Applying the GST to financial services is where we should start… We are now very close to having the ability to apply the GST to these services and it should be the first thing that is reviewed when we consider broadening the GST."