Meloni lowers the tax on banks after the sector lost 9,000 million on the stock market

The markets on Tuesday gave a slap to the plans of the Italian Government to approve a tax on the extraordinary profits of the bank. The announcement of the far-right Executive of Giorgia Meloni to create a 40% tax on those profits immediately plunged the valuation of the banks. In total, more than 9,000 million of its valuation were melted down. Faced with this situation, the Meloni cabinet had to backtrack and limit the scope of the tax. According to the Italian press published this Wednesday, the Ministry of Economy clarified that this tax will have a ceiling of 0.1% of risk-weighted assets.

The announcement made by Matteo Salvini, which surprised the banking sector and even members of the government, came face to face with the markets. Given the nervousness of the main financial markets, the Executive decided to backtrack to calm the markets. Late on Tuesday night, the Financial Times reported that the Finance Ministry had struggled to lower the figure approved in the Council of Ministers. The owner of the area himself had denied weeks before that Italy could take that path.

According to the sources consulted by the Anglo-Saxon newspaper, with this limit the Government will collect a ceiling of about 1,800 million euros, in contrast to the 3,000 million that the Executive estimated and the more than 4,500 million that they believed that the Executive itself could enter. The measure, which sought a source of income to help those with mortgages, obtained some support from the opposition. Analysts, however, warned against this one. “Some members of the government suggested that the initiative was aimed at ‘correcting the mistakes of the ECB’. It’s very depressing,” Lorenzo Codogno, ex-Secretary of the Treasury, consultant and professor at the London School of Economics, stated in a very harsh note, in clear reference to Vice President Antonio Tajani.

Before the modification that was circulated last night, and despite the unknown details of the decree, the Government had explained that the tax will be activated if the interest margin registered in 2022 “exceeds the value of the 2021 financial year by at least 5%”. . That percentage rises to 10% if 2023 is compared with the previous year. In any case, the tax may not exceed 25% of the bank’s own funds at the closing of its accounts in 2022, and must be paid throughout 2024.

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