Bank tax plans hit Dutch financials, ING down 6.3%


Financial shares took a big hit in Amsterdam on Friday following parliament’s vote in favour of an extra tax on bank profits during this week’s debate on the budget.

MPs say the tax would pay for some of the measures aimed at shoring up spending power for low income households. They have also mooted the introduction of a new tax on share buybacks.

Both measures, while backed by the current parliament, will probably be up to the new administration, with caretaker prime minister Mark Rutte warning that there is not enough time to pass the controversial legislation before the November general election.

Nevertheless, the vote has startled shareholders, with ING hardest hit. ING shares had fallen 6.3% by the close of trading on Friday. ABN Amro was down 4.5% and ASR Nederland 2.6%.

Insurance groups Aegon and NN also came under pressure with both declining 1.1%. The AEX blue chip index closed down 0.22% at 730.09

The Dutch banking association NVB has already warned MPs that they are “playing with fire” with a planned 80% increase in the tax on bank profits. Central bank president Klaas Knot has also said the measure will undermine banks’ resilience.

The big Dutch banks have all doubled their profits this year, but have come under fire for failing to put up interest on savings in line with market developments.

Italy and Spain, for example, are looking at imposing a windfall tax on banks that have not passed on higher rates to consumers quickly enough.

Dutch banks already pay some €500 million in extra taxes a year.

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