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Cyprus Savings Levy - could it happen here?
~Twinkle~
Posts: 8,166 Forum Member
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I'm horrified by this news report, 10% of people's savings being taxed and taken without warning, how could the EU sanction such a disgraceful act of theft? Am I correct in believing that this is theft? Monies taken without consent?
I'm hoping to goodness that Cyprus isn't setting a precedent, could something like this happen in the UK? Will news, such as this, mean that bank customers in the UK and elsewhere, will make a beeline to their nearest ATM immediately to withdraw their cash to stop such a disgraceful thing happening here?
http://www.guardian.co.uk/world/2013/mar/16/cyprus-savings-levy-imposed-eurozone
I'm hoping to goodness that Cyprus isn't setting a precedent, could something like this happen in the UK? Will news, such as this, mean that bank customers in the UK and elsewhere, will make a beeline to their nearest ATM immediately to withdraw their cash to stop such a disgraceful thing happening here?
http://www.guardian.co.uk/world/2013/mar/16/cyprus-savings-levy-imposed-eurozone
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It's certainly got me thinking! My life savings may now be withdrawn from the bank and laid neatly under my mattress, it's got to be safer there than anywhere and it most certainly won't suffer much from loss of interest.
I may have got the whole thing wrong, but the money that Cyprus is stealing from bank accounts isn't from interest, it's taking 10% tax on the total that's in the savings account.
I don't think you'll have to wait long somehow...
You can't chastise people for failing to save for their old age and then announce that anybody who has been smart enough to put a few quid aside is going to have to hand it over to the state. I don't think it could happen here, for that reason. It's penalising financially responsible people and will only leave a HUGE burden for future generations when nobody has any cash saved for old age. Let's face it, you'd spend it rather than hand it over, wouldn't you? I have a lot of savings because my grandfather left me a sixth of his estate, and I've resisted the urge to splurge it or buy a bigger car. But if I thought the government would take a few thouand off me, I'd put it all against the mortgage and leave nothing for contingencies.
I feel angry for the people of Cyprus.
That's not the same thing at all.
As for what happened in Cyprus its an outrageous theft.:mad:
Yep, a one off 10% for those with over 100k euros and 6.75% below 100k. But I am still having interest 'stolen' each year by the government in the form of tax, something that doesn't happen on those Cyprus savings accounts.
Why? I'm still having my money 'stolen' by the government and it happens every year.
If they dont get the money from the EU, the country will be gone, no police, army, no hospitals.
I reckon turkey would just wander over the border and take over the whole island.
If they cant get themselves out of the situation, then they will need to allow others to do it for them, but they cant expect to sit on their own pile of cash in the bank while asking other countries for money to keep them afloat.
I think the vocal people here will be foreigners who decided that cyprus is a nice place to live/retire, they will be trying to get their money out and run back home.
I feel no sympathy with ex-pats, they took their chances, they lost.
I hope this doesnt end in riots, almost the whole of the cyprus economy is based on tourism, if that ends, so will the country.
No, your money isn't being stolen, you're being taxed on your interest, your initial savings are still at the same level as when you banked them, taxing interest is totally different to taking 10% of the amount that you initially banked, you still have your stake. Those in Cyprus do not, 10% of what they've banked has now been stolen, taken, not interest related at all, their money has been taken without their consent. At least when interest is taxed, it doesn't affect the amount that you deposited, it's taxed on the gift that's known as interest.
It does make me wonder: is it worth putting savings in a bank these days?
Hardly encouraging propoganda for those still in favour of continued mmembership of the EU !
Spain will be next then.........................
It's a Bank Holiday in Cyprus. Banks will open (or not) on Tuesday. The Cypriots don't take things lying down. They will be festering all weekend and then things will kick off big time on Tuesday.
Hardly encouraging propoganda for those still in favour of continued mmembership of the EU ![/QUOTE]
The EU guilty of criminal behaviour! How very dare you!;)
They are also saying if its voted through they will also have to put a limit on how much an individual can withdraw ... so not only are they nicking the money they will be stopping those that own it spending it, that could cause all sorts of problems , like paying rent or bills or buying that house the money in the account was there for anyway.
It already happens here but in a different way. The artificially low interest rates, set by the bank of England, keep your savings deteriorating.
If the price of stuff goes up 5% a year (does anyone really believe inflation is at 2%?), and the bank are giving you 2% interest on your savings then your money is worth less in the bank, and you loose value.
Instead of taking it off savers, they do it by stealth, but it's effectively the same thing.
remember T Blair the lib dems and some conservatives wanted us in the Euro and still do!
Governments usually provide deposit insurance to prevent bank runs.
If the banking system is too big, and the banks’ losses are too big, relative to the government’s capacity to pay that insurance claim, that’s a problem.
But the problem is very different if the government (unlike Cyprus) can print currency to pay bank deposits that are liabilities in that same currency. If worse comes to worst, the government just prints as much currency as is needed to pay the depositors what they are owed. If that means is has to print “too much” currency, that’s a problem, because it means inflation will be “too high”. But that inflation will adversely affect the real value of currency and bank deposits equally. So even if people expect it might happen again, this doesn’t cause a bank run, where people try to get out of bank deposits into currency.
It’s a very different sort of problem in a country like Cyprus where the government cannot print money. If people see a “one-time tax” on bank deposits happen once, they might expect it to happen again. And if they expect it to happen again they will try to get out of bank deposits into currency. Which is a bank run.
The difference is that inflation from printing too much money is a tax on currency too. Cyprus cannot tax currency; it can only tax bank deposits.
If the banking sector is too big, and if bank losses are too big, relative to the country’s ability to pay, deposit insurance as a way to prevent bank runs is not credible and won’t work in a country that cannot print.
Nonsense. The money supply global is F******* Up. Neither the Tories, nor labour can do anything about the oversupply of money and excess debt until the banks (globally) are banned from electronically printing cash.
Labour, Tory, My dog. None of them can do anything about it.