Italy’s Economy Minister Stands By Controversial Bank Tax While Hinting at Refinements

On Sunday, Italy’s Economy Minister Giancarlo Giorgetti acknowledged that the recently introduced tax on bank profits could be fine-tuned. However, he disputed the idea that the tax was unjust.

Giorgetti made these remarks while speaking at the Ambrosetti economic forum, saying, “It’s possible to enhance the current tax structure, but labeling it as unjust isn’t something I can support.”

Last month, a surprise announcement came from the Italian government about a one-time 40% tax targeting banks’ profit margins, particularly those increased by higher interest rates. This led to a steep decline in the value of bank shares. It was later clarified that the levy would not exceed 0.1% of a bank’s total assets.

In a survey conducted among the forum participants, about a third expressed strong disapproval of the new tax measure, with two-thirds generally critical of it.

Giorgetti, a representative of the League party, countered this perspective, arguing that the state has offered substantial safety nets to the banking sector. While admitting that the initial announcement could have been handled better, he said, “I take complete responsibility for any communication lapses, and I am optimistic that the final draft will be well-received.”

Antonio Tajani, leader of the co-governing Forza Italia party, also weighed in, calling for specific exemptions from the new tax—particularly on returns from government bonds. This, he argues, would prevent negative implications for future bond auctions. Forza Italia is also pushing for tax exemptions for smaller banks and wants to ensure that the tax will be a temporary measure, ending by 2023.

Giorgetti refrained from offering any insights into his coalition partner’s proposals regarding the bank tax.

When questioned about the impending privatization of Monte dei Paschi di Siena bank, an issue Tajani urged quick action on, Giorgetti stated, “We’ll address this systematically, without rushing due to external pressures.”