Cypriot government presents a draft bill levy on deposits below 20,000 Euros.

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Parliament02_0 Cyprus’s revised draft bill for a levy on bank deposits will not affect deposits under 20,000 euros. However, this measure does not compensate for the resulting lost revenue by raising it for the wealthy. The draft will not fulfill the conditions required by the Euro group in return to the 10 billion loan. The draft sets a zero per cent levy on deposits of up to 20.000 euros and a 6.75% for amounts between 20,000 and 100,000 euros and maintains a 9,9% tax on all deposits above that level. After all the reactions caused after the euro group finance ministers announced a levy on all the Cypriot bank accounts the Eurozone finance ministers urged Cyprus to scrap the levy below 100,000 euros to spare small savers and raise it instead for wealthier clients of the bank to an amount as high as 15.6%. Nothing has been decided yet, but Nicosia was reluctant to agree to such a move because it fears to scare away foreign depositors, mainly from Russia and undermines the banking system and the business model of Cyprus.