Tax on interest and not unemployment is cause behind lower savings

The propensity to save is decreasing, claim bank representatives. The main reason is not necessarily the recession and the need to dip into one's saving, but is rather due to be introduction of the 20% tax on the interest on savings, as well as the fact that interest rates have fallen by seven percentage points over the last year. "It could be expected that as the profits on savings go down, a fact particularly felt during the last few months, the levels of savings would also decrease," commented Andrzej Topinski from Polish Banks Association (ZBP). He added that it is too early to determine what the long-term consequences will turn out to be. Sector analysts note that alternative forms of profitably investing one's savings are rather limited, so bank deposits will still remain the easiest and most appealing solution. Nevertheless, this process may discourage the Monetary Policy Council (RPP) from further cuts in interest rates. "The decrease of savings deposits speaks for caution in monetary policy," said the head of the council, Leszek Balcerowicz. (Prawo i Gospodarka, pp. 1, 7) M.K.