Irish minister backtracks on ATM charge proposal to discourage use of cash

Irish minister backtracks on ATM charge proposal to discourage use of cash

An Irish government minister has been forced to backtrack on proposals to charge customers for using ATMs as a way of encouraging a move away from cash to electronic money.

Minister for Justice Dermot Ahern floated the idea of a cash machine tax last week after an armed gang kidnapped the wife of a bank manager, forcing him to hand over EUR300,000 from the AIB branch where he works.

Ahern was widely quoted in the Irish press suggesting that imposing charges on cash machine usage could help push people towards cards, reducing the amount of notes held by banks and therefore reducing the chances of robberies.

The comments were criticised by opposition politicians, who accused Ahern of wanting to make the public pay for the actions of criminals, with Fine Gael justice spokesman Alan Shatter branding the idea a "kidnapper's tax".

The Irish Bank Officials' Association also gave the ATM charge idea short shrift while Aherm's own colleagues also appeared to distance themselves from him, with minister for enterprise Batt O'Keeffe telling the Irish Times that the issue had not been raised at cabinet level.

The beleaguered minister has since taken to the airwaves to insist he was not suggesting more taxes, telling RTE he only wants to "incentive" people to use cards more and cash less. He also floated the idea of removing the annual stamp duty on cards.

Although 2009 saw an 11.5% drop in the value of money withdrawn from ATMs in Ireland, according to the bank-backed Irish Payments Services Organisation (Ipso), the country is still way above EU norms for cash usage.

In July the government agreed to the creation of a high level group that will establish a National Payments Implementation Plan (NPIP) designed to wean the country off its dependence on cash and cheques.

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