Banks are the winners of the interest rate explosion. The opposition is now demanding an excess profit tax. With this, the SPÖ wants to finance an interest ceiling for the purchase of real estate.
In Italy, the right-wing government wants to collect more than two billion euros from a newly introduced tax of 40 percent on bank profits. Following this model, the opposition now wants to increase the pressure to introduce such a tax model in Germany as well. Finance Minister Magnus Brunner (ÖVP) is still firmly against it.
The policy rate was recently raised by the European Central Bank (ECB) to 4.25 percent. Banks currently park their money daily at the ECB for 3.75 percent. Only a fraction – about 0.35 percent interest – savers get. FPÖ leader Herbert Kickl has called for an excess profit tax in an open letter.
SPÖ wants to tax 15 percent of the profit
The Social Democrats also want to ask the banks to pay in the future, SPÖ Lower Austria boss Sven Hergovic explains to the “Krone”: “The banks can no longer be the secret beneficiaries of the crisis in the country. Tens of thousands of housebuilders and homebuyers can hardly afford the rising interest rates on their loans,” criticizes Hergovich.
The SPÖ model envisages a tax of 1.5 billion euros – about 15 percent of bank profits. “The billions should be used for a real interest cap on home loans,” says Hergovich. Home builders and all others who buy a home will then only pay a maximum of three percent interest on a loan of up to 300,000 euros when purchasing their first home.
In addition, Hergovich argues for a limit on the overdraft interest of less than five percent for overdrafts up to 5,000 euros. An excess income tax of about 23 percent would counteract all of these demands.
Source: Krone
I’m Ben Stock, a journalist and author at Today Times Live. I specialize in economic news and have been working in the news industry for over five years. My experience spans from local journalism to international business reporting. In my career I’ve had the opportunity to interview some of the world’s leading economists and financial experts, giving me an insight into global trends that is unique among journalists.
