Transfer of tax on deposits from depositors to banks will deteriorate terms of deposits and loans – expert
Kyiv, June 23 (Interfax-Ukraine) – The government's intention to transfer the main burden of tax on deposits from depositors to banks will deteriorate conditions for both depositors and borrowers, according to participants in a press conference at Interfax-Ukraine.
According the head of the Ukrainian Association of Investment Business, Dmytro Leonov, the entire draft law and its accompanying documents "are lies, from the beginning, and ending with the text written in the explanatory note."
"We are told it is dedicated to taxation of income from capital, but the law introduces a special tax on banks and credit unions for paying interest to depositors. That means that the credit institution must pay a tax to the state for the right to pay promised interest. This is not a tax on capital gains, because there is neither income nor tax on this income. This is a tax on the activity of financial institutions, and to compensate for these costs, it will have either to raise interest rates on loans or understate interest on deposits. In any case, this will affect both individuals and enterprises, because they will be offered worse and worse conditions that will compensate for this tax," he said.
CEO of the Ukrainian Credit-Banking Union Halyna Olifer expressed a similar objection.
"Analyzing the provisions of the bill, it turns out that the proposed special tax on capital is neither a direct tax, like a tax on income, nor indirect. It is charged as a markup on interest on deposits. But as interest on deposits is not a revenue of the bank, it turns out that it is a tax on expenses within the activities of banks and credit unions," she said.