House vote on Cyprus package to be put off [update]

The Cypriot Parliament may well postpone by at least a day its voting on the bailout package, originally set for 4 p.m. on Monday, according to state broadcaster CyBC. The Eurogroup is also about to hold an emergency meeting by videoconference.

The efforts to amend terms of the bill introduced by the government need to be prolonged in order to secure the approval of the House of Representatives, and the government prefers to delay its voting than risk its rejection, given it does not enjoy an overall majority in the House.

As a result, CyBC cited parliamentary sources to report that it is possible that voting could be put off by a few hours, or a day or even two, in order to convince as many parliamentarians as possible.

Debate in the House may well start on Tuesday at 4 p.m., instead of Monday at the same time.

The leaders of the parliament’s parties are meeting in Nicosia to decide about the next parliamentary session.

On his way out of the Parliament building after speaking to deputies on Monday afternoon, President Nicos Anastasiades said he was very satisfied.

Reports say that the eurozone is not against a proposed change to the terms of the package, so that accounts up to 100,000 euros in the island’s banks pay a tax of no more than 3 percent, instead of the original 6.75 percent, while those over the 100,000-threshold pay 12.5-15 percent instead of the original 9.99 percent.

A Cypriot government source told Reuters the introduction of a tax-free threshold for smaller bank deposits was under discussion but not yet agreed.

A report in Cyprus suggested that Panicos Demetriades, the governor of the Bank of Cyprus has proposed to the Financial Committee of the Cypriot parliament to exempt bank accounts with a balance up to 100,000 euros from the tax.

Reuters reported a Monday statement by Joerg Asmussen, member of the European Central Bank board, saying that “It is up to the government alone to decide if it wants to change the structure of the … contribution (from) the banking sector. The important thing is that the financial contribution of 5.8 billion euros remains,” he stressed.

Earlier, European Commission vice-president Olli Rehn had stated that “if Cypriot leaders decide a more progressive system for the contribution from deposits, on social justice grounds, and if this has the same financial result, the Commission is ready to propose to the Eurogroup to accept such a decision.”

CyBC also insists banks will not open on Tuesday, without attributing its information to a particular source.

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