Minister For Public Expenditure Paschal Donohoe has dismissed the idea of Ireland implementing a windfall tax on Ireland’s banking sector, after the Italian government surprised markets with their plans to tax banks 40% of their “surplus profits.”
Similar measures have been implemented in fellow European Nation member states like Spain, Czech Republic, Lithuania and Hungary, but Donohoe said he would not entertain the idea of a similar windfall tax being implemented in Ireland.
The Minister said “we already have a levy in place in our banking sector, it has been in place since the global financial crisis and so that measure is in place.”
Donohoe added “it’s a matter for the Minister for Finance in relation to the future of that levy.”
“We really appreciate that for many at the moment, the rising interest rates and inflation continuing to go up places so much pressure on so many. And we have looked to help to respond back to the rising cost of living with a variety of different measures, both in last year’s Budget and since then.”
Donohoe held the brief of Minister for Finance until December 2022, when he was swapped out for Fianna Fáil’s Michael McGrath in a reshuffle of cabinet, and the Dublin Central TD still holds the powerful position of President of the Eurogroup, which helps direct European Union financial policy.
A bank levy was introduced in the 2014 Budget, and has since raised at least €150 million a year for the Irish exchequer.
Italian Prime Minister Giorgia Meloni’s move to tax Italian banks at 40% of their annual profits was seen as a shock to the Italian banking system, but Meloni’s Deputy Prime Minister Matteo Salvini told Italian radio there was a “social justification” behind it.
“Some bankers are regretting it but we are talking about an industry that is making billions and billions in profits without lifting a finger.”
“Redistributing a small part of these profits is economically and socially justified,” he said, saying that the right-wing government plans to use proceeds to help mortgage holders as well as those on low incomes and small pensions.
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