The European Central Bank criticizes the new Italian tax on bank profits

The European Central Bank criticized the Italian government's proposed tax on bank windfall profits, saying it did not take into account lenders' long-term prospects and may make some of them vulnerable to an economic downturn. "The amount of the windfall tax may be disproportionate to the long-term profitability of a credit institution and its ability to generate income," it said. capital" .

The European Central Bank added that it is not entirely clear how total assets will be calculated and raised the possibility that banks will record losses or lower profits when paying the tax in mid-2024, stressing that “care must be taken to ensure that the exceptional tax does not affect the ability of individual credit institutions to build capital bases.” "Powerful."

Italian Prime Minister Giorgia Meloni stressed that “if there are corrections they can be made but I do not want to undo them,” and Italian lawmakers are drafting proposals to mitigate the impact of the tax, including allowing banks to partially deduct what they have to pay from the total corporate tax bill, as it is likely that Some amendments exempt small banks from paying the tax.

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