BERLIN – Leading German opposition figures criticized on Monday a deal struck by European governments to bail out Cyprus, saying smaller savers in the Mediterranean island's banks should be spared a levy on their deposits and bigger savers hit harder.
Under a 10 billion euro rescue agreed in the early morning hours of Saturday in Brussels, savers with deposits below 100,000 euros would be hit with a 6.7 percent tax, while those above that threshold would take a 9.9 percent hit.
"Why don't we take 15 percent from those with lots of money and completely exclude those with deposits under 25,000 euros from the levy?" Juergen Trittin, parliamentary leader for the Greens, told German television.
The deal unsettled markets on Monday morning and has sparked a backlash in Nicosia and other European capitals. Sources told Reuters that Cypriot authorities were already considering changes that would cut the tax on smaller savers to 3.0 percent, while pushing up the one on big deposits to 12.5 percent.
Like Trittin, the deputy leader of the Social Democrats (SPD) in parliament Joachim Poss said it had been right to hit bank deposits in Cyprus but wrong to make small savers pay such a high price.
"The question is whether this shouldn't be concentrated on those above the 100,000 euro level," Poss told Bavarian radio.
The lower house of parliament must approve the bailout deal for it to go ahead. German Chancellor Angela Merkel has a majority in the Bundestag but has counted on the support of the opposition in past bailout votes.
(Reporting by Noah Barkin)