FPÖ/ÖVP talk again

Opposition to bank levy is forming

The FPÖ is back at the green table with the ÖVP,

(Bild: APA/HELMUT FOHRINGER)

The report in the "Krone" newspaper about Herbert Kickl's desire for a bank levy has caused quite a stir. Resistance to the blue party leader's proposal is already forming in the ÖVP and in the industry. However, the FPÖ is sticking to its guns and will present a concrete model in the "Taxes" negotiating group on Wednesday.

How high such a levy could be is the subject of the negotiations. In the tripartite negotiations, the SPÖ had proposed a temporary special levy of up to one billion a year for the seven-year budget consolidation period. The bank levy currently generates 140 million.

The bank levy was introduced under Chancellor Faymann and Finance Minister Pröll

(Bild: APA/HELMUT FOHRINGER)

The bank tax was introduced after the banks were bailed out with tens of billions of euros of taxpayers' money during the 2008 financial crisis. At the beginning of its term (2010/2011), it brought in 500 million euros, later even 640 million euros. However, it was quickly scaled back again (2017). The costs of the bank rescue, which the Momentum Institute calculates at eleven billion, have so far only been half compensated with revenues of 5.3 billion.

Politicians focus on excess bank profits
However, it is not only the bailout that speaks in favor of a further increase in the bank levy, the record profits of recent years are also considered to be a contributing factor. Twelve out of 27 EU countries have introduced new bank taxes for this reason. Lithuania and Latvia expect the highest additional tax revenues - measured in terms of economic output (GDP) - at 0.33 percent, while the Netherlands expects the lowest at 0.01 percent. On average, the twelve countries demand 0.17 percent of gross domestic product as a tax contribution from their banks.

Average tax would generate 850 million
Applied to Austria, the revenue from the respective countries would amount to between 69 million euros and 1.7 billion euros. If a new Austrian bank tax is in line with the average of the twelve countries, Austria could raise 850 million euros per year. That is around a fifth of the amount that Austria will have to save next year.

"Populist, cheap"
There has already been opposition from the banking sector. Oberbank CEO Franz Gasselsberger described considerations for such a levy in the "Salzburger Nachrichten" newspaper as a "populist, very cheap demand". The demand is cheap "because we know that we may not have many opponents," said Gasselsberger.

According to the Oberbank CEO, it should not be forgotten that Austrian banks have developed significantly better than European banks over the past ten years. The economy is also heavily reliant on credit financing and banks therefore need equity capital. "This issue simply has to be rejected," said the bank boss.

Blue-black negotiations enter second round
After a turbulent weekend, the FPÖ and ÖVP negotiators are back at the table. They are entering the second round. The economy, agriculture, defense, home affairs and justice groups met on Monday. The first details from the last area have already leaked out.

Blue and black are likely to be tinkering with a small reform of the judiciary, for example. It was only in December that the National Council passed a reform of the Code of Criminal Procedure - among other things to strengthen the protection of victims. The next amendment could soon follow under the blue-black coalition.

Will the age of criminal responsibility be lowered?
As the "Krone" has learned from negotiating circles, the rights of the accused could be strengthened and (higher) compensation payments could be made in the event of acquittals. The age of criminal responsibility is to be lowered from 14 to 12 years. Measures against suspicion-based reporting based on the German model are also likely to be discussed, and the much-cited ban on media quoting from files will therefore become an issue again.