Parliament: unanimous vote for bank levy

 

PARLIAMENT last night unanimously approved a 0.095 per cent tax on bank deposits, expected to fetch the state some €60 million a year.

Lawmakers also amended the law, extending the levy beyond the two years – 2011 and 2012 — as was initially proposed by the government.

The amendment to extend the tax beyond 2012 was submitted by opposition DISY and government partners DIKO. AKEL and EDEK voted against.

The levy was expected to generate around €120 million for its two year validity.

“A financial stability fund is a very important and positive step which will help us deal with any further ratings pressure on our financial system,” said Nicholas Papadopoulos, chairman of the House Finance Commitee.

After 2012, all the proceeds will be transferred to the bank stability fund. MPs also unanimously approved, an amendment submitted by the Green party providing for a fine up to €100,000 on any bank caught transferring the cost of the levy onto its customers.

The Central Bank Governor said recently the bank was in the process of creating its own – separate — stability fund, aiming for an initial amount of some €500 million.

The initial target, Athanasios Orphanides said, was to build a fund of around 3.0 per cent GDP through bank contributions. The aim is to have this fund ready by September.

 

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