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European Banking Federation presses for changes to financial sector tax

The European Banking Federation has called for “profound modification” of the planned Hungarian tax on financial sector companies, calling it “discriminative” and warning the tax could make some lenders loss-making, Bloomberg reported on Friday, citing a letter it obtained from the federation.

The scope and discriminatory nature of the tax, combined with corporate tax and the existing solidarity tax, could push several Hungarian banks into losses as lenders' effective tax rate would exceed 60%, the banking federation said in the letter signed by Alessandro Profumo, its president.

Prime Minister's spokesman Péter Szijjártó told MTI on Saturday that the Council of Europe had agreed at their last meeting, days earlier, that member states should introduce a tax system for financial institutions that would level the playing field and provide an incentive for limiting system-level risk. In this respect, Hungary is again at the forefront in Europe, he added. (MTI-Econews)