NICOSIA – The Cyprus cabinet was meeting on Sunday morning to approve a bill imposing a levy on all bank deposits, amid conflicting reports on whether it can command enough votes to be approved by the House of Representatives.
President Anastasiades said on Saturday that Cyprus had the choice of agreeing the bailout or being forced into disorderly bankruptcy when banks reopen after the bank holiday on Monday.
He is due to brief the House Finance Committee at the Presidential Palace. Anastasiades was due to brief MPs at the House later this morning, but media reports said this has been postponed. An address to the nation is also schedulled for today.
The euro zone demand on Saturday that savers pay up to 9.9% of deposits as a condition for the 10 billion euro bailout drew fury here and caused some jitters elsewhere in the region.
Cypriots emptied cashpoints after news emerged of bailout terms which broke a previous euro zone taboo on protecting depositors in its efforts to address the regional debt crisis.
The tax on deposits is expected to raise up to 6 billion euros as a condition for the bailout, mainly needed to recapitalise banks.
Those affected will include rich Russians with deposits here Europeans who have retired to the island as well as Cypriots themselves.
The size of foreign deposits is estimated at 37% percent of the total - was one reason the euro zone agreed to the tax on savings .Cyprus stopped electronic transfers over the weekend.
In Spain, one of four other states getting euro zone help and seen as a possible candidate for a sovereign rescue, officials were quick to say that Cyprus was a one-off. A Bank of Spain spokesman said there had been no sign of deposit flight.
Two Cypriot banks in Britain told savers their money was safe.
Parliament will meet at 4 p.m. (1400 GMT) in an emergency session to discuss the proposal -- 9.9% for those exceeding 100,000 euros and 6.7% on anything below that.
The choice was between "the catastrophic scenario of disorderly bankruptcy or the scenario of a painful but controlled management of the crisis," President Anastasiades said in a written statement.
His right-wing Democratic Rally (Disy), with 20 seats in the 56-member parliament, needs support from other factions for a vote to pass.
"The dilemmas are very tough," said Marios Garoyian, president of the centre Democratic Party (Diko). "Things are unbelievably hard."
He did not say which way his party would vote on Sunday. It is already split over backing Anastasiades three weeks ago.
Akel, accused of stalling on a bailout during its tenure in power until the end of February, is meeting today amid signs it will vote against. Socialist Edek, which has called EU demands "absurd", is also expected to reject the bill..
"This is unacceptably unfair and we are against it," said Green Party’s Adonis Yiangou the smallest party in parliament but with the potential ability to swing any vote.
"They have got a gun to our head," he said.
Some 150 people protested outside the Presidential Palace last night as the president briefed party leaders and further protests are expected today.