Lebanon’s banks staged a one-day strike Friday, complaining that lawmakers were aiming to administer a “coup de grace” to the ailing economy by imposing a hike on their deposit revenue taxes.
Banks Association President Francois Bassil claimed politicians were making “random” proposals to help fund a new salary scale for teachers and public servants.
Bassil sought to temper his stance Friday by heaping praise on Speaker Nabih Berri, the head of the institution that was supposedly poised to crash the economy. The banks’ outburst has done little to help their standing in the eyes of the public, which for years has been directly experiencing the effects of the deteriorating economic situation.
In fact, the banking sector has been isolated from the downturn in economic conditions in recent years, judging by the profits that banks regularly announce. The banks have a guaranteed, huge client in the form of the Lebanese state, charge interest rates that are relatively high and benefit from a national currency that has been relatively stable for 22 years, in case they have forgotten.
The “random,” doomsday measures that were so objectionable to the banks amounted to items such as: raising the tax on deposit interest revenues from 5 to 7 percent and on their overall performance, while other taxes covered illegal construction on seafront properties. The latter move, far from being “random,” represents a long-standing demand by all manner of reformists.
It is a positive sign that the proposals have generated such an outcry, because this puts the banks, and their interaction with society, under the spotlight – and the more that the public learns about how things really work in Lebanon, the better.
A version of this article appeared in the print edition of The Daily Star on April 12, 2014, on page 7.