Closely watched negotiations between the Greek government and its institutional creditors – now euphemistically known as the “quartet” – resume on Wednesday, and with a proposal on the table for a tax or levy on bank transactions, a prospect that is a “red flag” for Greece’s credit institutions.
By Anna Doga & Thanos Tsiros
Closely watched negotiations between the Greek government and its institutional creditors – now euphemistically known as the “quartet” – resume on Wednesday, and with a proposal on the table for a tax or levy on bank transactions, a prospect that is a “red flag” for Greece’s credit institutions.
Progress this week, especially on the all-important issues of pension reform and fiscal policy, will reportedly determine whether talks will conclude next week and before Catholic Easter, or whether an April 22 Eurogroup meeting will be the conclusive date.
Institutional creditors (EC, ECB, IMF, ESM) reportedly want measures to cover a projected fiscal gap in the Greek budget – regardless of projections on the size of the gap – with standing proposals for an expansion of the tax base, downwards, new tax indices and even a levy on bank transactions.
The prospect of a levy on bank transactions comes in the face of a failure to slap a tax the biggest lottery and betting pools operator’s (OPAP) games or on future video lottery terminals, with projected revenues from such a tax even listed on the 2016 budget.
The Hellenic Bank Association, which represents credit institutions in the country, has expressed “serious reservations” over the prospect of yet another levy on traditional and electronic transactions – with the latter category exponentially increasing since the imposition of “capital controls” in the country in late June 2015.