Sunday 23 October 2016

Banks likely to pass on levy cost to customers

Published 15/10/2015 | 02:30

Dermott Jewell, Consumers Association
Dermott Jewell, Consumers Association

Banks are expected to find ways to pass on the bank levy to customers.

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The bank levy is to be extended to 2021, in a move that will raise €750m for the exchequer.

But chief executive of the Consumers' Association Dermott Jewell called on the Central Bank to monitor banks to ensure they do not load excessive charges on customers to recoup the cost of the levy.

"It is guaranteed that there will be no easement in fees and charges. Banks will find new and innovate ways to pass on the cost of the levy to customers," Mr Jewell said.

"The Central Bank should monitor the banks to see how this unfolds."

Finance Minister Michael Noonan said on Tuesday that a review would take place of the methodology to calculate the levy.

The levy was originally introduced for three years from 2014 to 2016 to allow for a "contribution" from the banking sector to the economic recovery. It brings in €150m a year and is calculated on the basis of Dirt payments made in 2011.

"The scale of the levy over the period is equivalent, for example, to the cost of the new National Children's Hospital," Mr Noonan said.

A spokeswoman for the Irish Banking and Payments Federation said: "The banking industry will consider the full impact of the decision to extend the bank levy."

She did not answer questions on whether or not the cost of the levy would be passed on to customers.

Irish Independent

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