The securities of Italian banks plunged on Tuesday, August 8, on the Milan Stock Exchange, after the decision of the government of Giorgia Meloni to levy a 40% tax on their “surplus profits” generated by the rise in interest rates. Around 9:40 a.m., Intesa Sanpaolo lost 7.7%, Unicredit 6.2%, Monte dei Paschi di Siena 7.3%, BPER Banca 7.7%, Banco BPM 6.7% and Mediobanca 2.9%, in a market down 1.64%.
Italy wants to create this tax to offset the cost to households and businesses of soaring interest rates, Deputy Prime Minister Matteo Salvini announced on Monday evening. This increase, which has significantly increased the profits of banks, has harmed their customers who are bearing the brunt of the increase in their borrowing rates, deplored Mr. Salvini after a Council of Ministers. “It’s not a few handfuls of millions, but a few billions. It is a measure of fairness, ”assured the boss of the League, a far-right party member of the government coalition led by Giorgia Meloni.
The tax on the excess profits of banks, which must be settled by June 2024, will concern the accounting years of 2022 and 2023, learned Agence France-Presse from a government source. The 40% levy will be made if the net interest income recorded in 2022 exceeds the value of the 2021 financial year by at least 3%. This tax will be applied to the part exceeding the amount of the previous financial year. In 2023, profits must be 6% higher than in 2022 for the tax to apply.
Italian banks, like their European competitors, saw their net interest income soar in the wake of the rise in interest rates, without increasing the remuneration of their customers’ current accounts.
