Govt breaks promise made in agreement with new tax, Banking Association says


The financial transaction tax announced by the national economy minister is contrary to the agreement concluded last December between the government and the Banking Association, the Banking Association told MTI.

The statement notes that the government made a commitment in the agreement last December that the extent and the base of the special bank levy will remain unchanged in 2012 compared to the effective regulation, decreasing by 50% in 2013 and only a bank levy complying with that adopted by the European Union would be imposed or one not exceeding the average rate of the bank levies applied by European Union member states in 2014.

This is why the freshly announced financial transaction tax, which appears as extra expenditure at financial institutions, is contrary to the promise made in the agreement, the statement adds.

The Banking Association also notes that the government aims to help Hungarian companies' access to credit, with the active involvement of the financial intermediary system. If, however, financial institutions are burdened with additional taxes, it will unavoidably weaken the financial institutions' ability to lend and make credit more expensive.

The statement points out that the predictability of the regulatory environment is a necessary condition to the operation of the economy, which could lessen the negative consequences of the crisis, while unpredictability will clearly strengthen the deteriorating effects of external factors.


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