ANZ CEO says high taxes prevent Australia from being top Asian financial hub

SYDNEY, Sept 15 (Reuters) - ANZ Group ANZ.AX Chief Executive Nuno Matos said on Tuesday that Australia had some of the ingredients needed to become a regional financial hub, but its unfavourable tax regime was holding it back.

Matos said Australia had developing capital markets and a big pool of domestic savings through its compulsory pension system, two conditions that were important to becoming a top hub.

But Australia lacked a tax regime capable of attracting foreign capital, unlike other financial centres in the Asia-Pacific region, he said.

"You also need to have very favourable taxation (to be a financial hub). And in that case, Australia does not have it," the Portuguese-born former HSBC executive told a conference in Sydney.

He said capital was not attracted to high-tax environments.

"Hong Kong and Singapore, they are basically 0% tax on capital," Matos said.

Australia should not "expect to be a financial hub if you don't attract capital, financial capital", he said, adding that "capital taxation needs to be different".

In June, Australia's parliament passed legislation scrapping the 50% capital gains tax discount on assets held for more than a year from July 1, 2027, returning to the pre-1999 policy of taxing inflation-indexed gains, with a 30% minimum tax on net capital gains.

Australia's parliament also passed legislation last week broadening the types of assets on which foreign residents are subject to capital gains tax.