ECONOMY

Christmas bonus spent on taxes

The Christmas bonus paid out to private sector employees, totaling about 1.5 billion euros, has all gone toward the payment of various taxes rather than saved in bank accounts, as had been the norm in previous years, keeping the total deposits figure at around 160 billion euros.

December used to be a month during which deposits increased by at least 1 billion euros. However, this year there was no Christmas bonus for civil servants or pensioners, unemployment has surpassed 27 percent, while the record low bonus of 1.5 billion euros that private employees were given went directly to the tax authorities, according to bank officials. Obligations for income, road, luxury and property taxes along with other charges meant that not only was there no money left for saving but hardly anything for additional consumption over the holday period.

As a result December is estimated to have added nothing to the 160 billion euros in total deposits at domestic banks, while some estimates say that there may have even been a reduction below the 160-billion-euro mark, viewed by many as a psychologically important level.

After a negative 2012, when the deposits of households and corporations contracted by 13 billion euros, 2013 appears to have closed with inflows and outflows being level.

Credit sector officials are pointing to a tough 2014 as savings are expected to shrink further due to the reduced incomes and increased tax obligations that the new year is promising. The unknown factor is political stability, ahead of the European and local elections in May, which means that a further decline in bank deposits cannot be ruled out.