MADRID (Reuters) – Spain’s High Court has rejected appeals by lenders Bankinter, Sabadell and Cajasur to suspend payments of the extraordinary banking tax while it reviews the levy’s validity, El Economista newspaper reported on Monday.
Spain approved in December a temporary 4.8% levy on banks’ net interest income and net commissions above a threshold of 800 million euros ($861 million) as part of measures aimed at easing the cost of living of ordinary Spaniards amid high inflation.
Some banks and associations objected to the tax and filed challenges before the High Court, while the European Central Bank also warned of adverse effects on the banking system.
According to El Economista, the court reasoned that the banks would be able to recover the amount paid plus interest were the tax found to be unlawful, while suspending payments would be illegal and cause serious damage to the general interest.
The High Court could not immediately confirm or deny the report, which also said that the court had refused to raise the question of the levy’s constitutionality before the Court of Justice of the European Union.
Bankinter, Sabadell and Kutxabank, which owns CajaSur, declined to comment.
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(Reporting by Emma Pinedo and Jesús Aguado, editing by Andrei Khalip and Angus MacSwan)