Tax tranche puts deposit rise to the test

Tax tranche puts deposit rise to the test

The last three days of July, right up until midnight on Monday, will put the growth trend observed in bank deposits to a major test. The 1-billion-euro rise recorded in June has been augmented this month according to banks, but officials say Monday is the key day, being the deadline for the first tranche of income tax.

The payments to be made via alternative networks on Saturday, Sunday and on Monday, and mainly those made at bank branches on Monday are likely to see much of the growth registered in the last couple of months evaporate.

The rise in deposits is partly attributed to the increase in tourism flows, even though some 25-30 percent of total tourism revenues never enter the country’s system as they remain in banks abroad. The increase in consumption and turnover has been clearly reflected in deposit data since June, pointing to a reversal of the declining trend observed in the first quarter of the year.

Bank of Greece figures show that household and corporate deposits in banks amounted to 120.4 billion euros at end-June, against 119.4 billion at end-May and 118.9 billion at end-April. They have therefore covered most of the ground lost in Q1, as at end-December deposits had amounted to 121.4 billion euros.

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