The Polish zloty sold off sharply yesterday during trading, with EUR/PLN approaching 4.22 at one point in the afternoon and although this was part of the general risk-off move in markets, it did not help the zloty that the leading candidate of leftist Opposition PiS proposed a bank tax.



It has been suspected for some time now that a PiS victory at the autumn general election would bring losses for banks, either via a bank tax or via forced conversion of FX loans after PiS won the presidential seat, new President Duda also proposed a large-scale conversion of FX loans at originally contracted exchange rates, which would mean substantial losses for banks.



Yesterday, PiS PM candidate, Ms Beata Szydlo, became more specific and proposed a bank tax of 0.39% of assets; this tax would apply to all banks and financial institutions and would be a permanent tax. Hungary's bank tax is currently levied at 0.53% of assets, but is being scaled down to 0.31% by 2016.



Just as is the case in Hungary, PiS also wants to impose sector taxes, such as on retail chains. Such policy proposals by the party which is leading widely in all polls are a strong cause for concern for Polish asset prices and the zloty in coming months as these would constitute a radical policy departure from current policies, says Commerzbank.