A proposal by the European Commission, the IMF and the European
Central Bank to impose a one-off tax of up to 15 percent on depositors'
accounts in Cypriot banks, as a condition for a $10 billion bailout of
Cyprus, could hit Russian account holders hard, with some experts
forecasting that the tax could result in losses of more than $3 billion
for Russian companies and individuals.
The proposal has been rejected by the Cypriot parliament as hitting
small local depositors and Russian investors alike, threatening
Cyprus's position as an offshore tax haven and the island country's
economy. Russia's president, Vladimir Putin, has attacked the European tax plan as "unfair,
unprofessional and dangerous," while Prime Minister Dmitry Medvedev has
compared it to Soviet-era confiscation of private property.
Cypriot
government officials are in talks with their Russian counterparts about
possible help from Russia to rescue the country's economy from
bankruptcy.
