The Italian banking lobby ABI urged Prime Minister Giorgia Meloni to make changes to the windfall tax, saying that the law’s legal basis isn’t clear.
(Bloomberg) — The Italian banking lobby ABI urged Prime Minister Giorgia Meloni to make changes to the windfall tax, saying that the law’s legal basis isn’t clear.
The tax on banking profits “raises doubts about its compatibility with constitutional principles,” ABI said Tuesday according to a statement prepared for a parliamentary hearing.
The statement reflects the industry’s frustration with a decision by Meloni’s government in mid-August to impose a tax on additional profits earned by banks. The government has accused lenders of being too slow in passing the benefits from higher interest rates on to clients.
The tax surprised investors and weighed on stock valuations of the country’s financial industry. Intesa Sanpaolo SpA Chairman Gian Maria Gros-Pietro said in an interview with Bloomberg earlier this month that the bank will pay lower dividends “if we have lower profits.”
Read More: Intesa Sees Less Than €1 Billion Impact From Italy Bank Tax
ABI said in the speech that the government’s move may hit investor interest in the sector. “Unjustified penalization” of banks could crimp lending to consumers and companies, it also said.
Changes to the law recommended by ABI included allowing lenders to deduct the windfall tax from their overall tax bill.
Read More:
Italian Banks Slump After Government Introduces Windfall Tax
ECB Readies Complaint to Italy on Bank Tax, Corriere Says
Intesa Sees Less Than €1 Billion Impact From Italy Bank Tax
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