Govt rejects bank 'blackmail' on tax hike

Delrio says banks have denied credit to families

(ANSA) - Rome, April 14 - Italian Premier Matteo Renzi's government will not accept "blackmail" by banks threatening to choke off credit to families and firms if faced with a tax hike, Cabinet Undersecretary Graziano Delrio said Monday. "The banks say that because of this taxation they will cut credit to families and firms? We will not stand for it, this is blackmail that we don't accept," Delrio said in an interview with Rai's Porta a Porta programme.

"The banks received 1,000 billion (euros) from the BCE and transferred almost nothing of that to families," he added. The banks had complained about a tax hike planned by Renzi to get the cash needed for a signature tax cut on low earners, saying it would deepen Italy's credit crunch. Renzi recently announced he was doubling the levy on banks' surplus deposits at the Bank of Italy, to 26%, to help cover an 80-euro-a-month cut on the estimated 10 million households on a wage of 1,500 euros or less.

The hike "would take one billion euros in liquidity away from the banks, (cash which is) destined to issue loans to families and businesses," said the director-general of Italian Banking Association ABI, Giovanni Sabatini.