BRATISLAVA, October 20, (WEBNOVINY) — The Slovak Parliament has greenlighted in the third reading a draft bill on a special levy on selected liabilities of financial institutions. If President Gasparovic signs the bill into law, banks will start transferring 0.4 percent of selected liabilities net of deposits protected by the Deposit Protection fund and banks’ own sources [basically corporate deposits – SITA note] to state coffers as of early 2012. The initial blueprint set the rate of the levy at 0.2 percent of selected liabilities but the Finance Ministry later decided to raise it to 0.4 percent. The increased rate is expected to collect an additional EUR 40 million for state coffers, while overall income from the new levy is projected at EUR 80 million.
Opposition SMER-SD suggested a bank levy of 0.7 percent in September that was supposed to increase state revenues by additional EUR 189 million. SMER-SD deputy Peter Kazimir stated that the three largest banks in Slovakia directed some EUR 180 million in dividends to their parent companies, close to the projected revenue from the 0.7-percent rate. “They send them money because these parent companies are ailing, while they pay the same kind of levy as we intend to introduce in countries where their parent companies do business,” he noted.
The Finance Ministry did not back this plan. The rate proposed by the opposition party might bring more money over a short time period but would disturb competition and the business environment, the ministry argued. Thus, Kazimir’s amending proposal to raise the rate to 0.7 percent failed. The deputy also tabled another amending proposal to prevent banks from increasing fees to the detriment of clients, as a result of the new bank levy. However, deputies rejected this concept, too.
The Slovak Banking Association has warned that the bank levy will rattle stability of the banking sector and may increase prices of products and services.
SMER-SD leader Robert Fico pledged that if his party gets into government after the early elections in March, it will return to this norm and attempt to push through the rejected proposals. Fico said than the state coffers could have obtained an additional EUR 100 million if the taxation of banks was higher.
MPs also gave the go-ahead to a revised bill on local fees and taxes. The norm from the workroom of the Finance Ministry, setting one common tax return for local fees and taxes with annual taxation period, will take effect as of December 1, except for some articles, which will come into force in early 2012. It will apply to tax on real estate, charges for ownership of dogs, tax on vending machines, etc. Legislators further voted in favor of revisions of Labor Inspection Act and the Occupational Safety and Health Act.
SITA