Italy hits banks with 40% windfall tax for 2023
Timilehin Adejumobi
1 min read
Italy has approved a one-off 40% tax on profits banks reap from higher interest rates and it plans to use proceeds to help mortgage holders, in a move that sent banking shares plunging.
Sharply higher official interest rates have yielded record profits for banks, as lenders were able to hike the cost of loans while holding off paying more on deposits.
Countries such as Spain and Hungary have already imposed windfall taxes on the sector.
Only for 2023, Italy will tax 40% of banks’ net interest margin, a measure of income banks derive from the gap between lending and deposit rates.
Rome expects to collect less than 3 billion euros ($3.29 billion) from the measure, sources close to the matter told Reuters.
However, some analysts’ estimates were higher.
Top Italian bank Intesa Sanpaolo (ISP.MI) at the end of last month said it expected to pocket more than 13.5 billion euros this year from its net interest margin alone.
This report’s information was first seen on REUTERS; to read more, click this link.
