This afternoon we reported that the Cypriot Parliament vote on the depositor banking haircut had been delayed until Monday as the banking cartel was 33% short of the necessary votes needed to pass the bail-in/ wealth confiscation.
In a desperate attempt to appease Cypriots and pass the measure Monday, RT reports that the IMF is discussing reducing the wealth confiscation for deposits under €100,000 to 3%, and compensating by raising the tax to approximately 13% on larger accounts (i.e. wealthy foreign Russian oligarchs).
RT reports that those with over €100,000 may be looking at a 12.5% wealth tax if the new agreement passes:
Cyprus is currently deciding whether to raise the anti-crisis tax on savings larger than €100,000 to 12.5%, while reducing the levy on smaller amounts to 3 per cent, a source told Reuters.
The Cypriot government has been discussing with its European creditors the idea of reducing the levy on deposits smaller than €100,000 to 3 per cent, Reuters reported citing an anonymous source who is close to talks.
To counterbalance the measure, the government proposed to increase the tax on large sums to 12.5 per cent from the originally proposed 9.9, the source said.
The last minute discussions are allegedly aimed at appeasing ordinary Cypriots who are about to share a major part of the anti-crisis burden imposed on Cyprus by the European Central Bank.
Notice that Cypriot bank funds have been frozen prior to any deal actually being agreed to by the Cypriot Parliament:
A meeting of the Cyprus parliament had been scheduled for Sunday but was postponed for at least a day in order to try and broker a deal between the parties, political sources are saying. The vote on the measure is now expected on Monday.
At the same time authorities have extended for another day Monday’s bank holiday, so the levy is unlikely to come in force on Tuesday morning as was initially planned.
There really is nothing to worry about for those with their cash in the Cypriot banking system, President Anastasiades states that those who keep their entire deposits in Cypriot banks will get half of their confiscated funds back in worthless bank bonds:
On Sunday, the Cypriot president addressed the nation claiming that this new tough decision was the only available measure to avoid default and subsequent separation from the EU.
“Those who hold on to their deposits for two years, will get back half of their deposit in bonds,” Nicos Anastasiades said, trying to avert an imminent wave of deposit withdrawals after the holidays.
The president promised that the bonds will be secured by the revenues in the gas field and promised that pension and provident funds will remain untouched by this one-time measure.
So Anastasiades is promising that pension and provident funds will remain untouched by the government. Just like they promised depositor haircuts would be completely off-limits. Until it happened.