Will Slovakia introduce a bank levy?

Will Slovakia introduce the bank levy proposed by the EU? The Slovak government has now expressed its support for the bank levy envisaged by the European Union. This support was confirmed by Slovak Finance Minister Ivan Miklos at a press conference in the Slovak capital, Bratislava, last Wednesday.

As Miklos explained in his statement, the introduction of a bank levy in Slovakia is to be undertaken as a “coordinated initiative.” The measure is to be designed so that Slovakia’s citizens do not have to suffer any disadvantages as a result of the levy. Asked when the new bank levy might be introduced in Slovakia, Finance Minister Miklos said it could be implemented as early as January 1, 2012.

Slovakia has been a member of the eurozone since 2009. Slovakia’s move to attract investors with a flat tax rate of 19 percent was sharply criticized in some other EU countries as “tax dumping.” The government in Bratislava has said that no agreement has yet been reached on the level of the new bank levy. Minister Miklos expects the new tax to amount to “hundredths, rather than tenths of a percentage point.” At this stage, the finance minister does not expect the new bank levy to have an adverse effect on bank fees

Miklos also took the opportunity to comment on the proposal made by France and Germany. Both countries are calling for the alignment and thus harmonization of tax policy within the European Union. This could be achieved by establishing a uniform tax base across the EU. Miklos rejects the proposal, fearing that alignment would lead to a deterioration of Slovakia’s tax system.

The young state of Slovakia now faces its next step toward Europe: the government in Bratislava is gradually undertaking reforms. With the introduction of the new bank levy, Slovakia will move closer to the established member states—if the reform does indeed take place soon.