As the full implications of the Budget sank in yesterday, the dramatic increase in stamp duty on bank cards attracted as much, if not more, frustration than the new levy on financial institutions, write Laura Slattery and Dominic Coyle.

Banks spent the day fielding calls from irate customers after the Minister for Finance, Mr McCreevy, more than doubled the duty customers must pay on credit and charge cards, hit ATM card users with a 60 per cent rise and introduced a charge on laser cards.

The Irish Bankers' Federation (IBF) said the Government had increased the cost of banking for customers by 131 per cent. A customer who has a laser card, ATM card, credit card and writes 50 cheques a year would see their costs rise from €29.25 to €67.50 a year because of the higher stamp duty, an IBF spokesman said.

Stamp duty on credit cards and charge cards will more than double from €19 to €40 a year. The move is thought likely to reduce the number of people who hold credit cards from more than one card issuer. The duty applies to each charge card but, in the case of credit cards, is levied on the account. This means additional cardholders nominated by the credit card applicant do not incur an extra charge. Cardholders can usually nominate one other person to the account, although some gold card products allow applicants to choose up to three additional cardholders on their account.

Laser cards, which had been exempt from Government stamp duty, are now subject to a €10 charge. ATM cards, which customers use to withdraw money from savings accounts, have risen from €6.25 to €10 per card. In each case the charge is on the card and not the account which means joint account holders face charges in respect of each card held on the account. Cards with a combined cash and laser function will cost €20 a year, up from €6.25.

The IBF said 2001 figures showed there were 3.4 million ATM cards in circulation. Irish bank customers hold 1.2 million credit card accounts. The increased duty should bring €42.5 million into the Exchequer next year.

Mr McCreevy also targeted stamp duty on cheques, pushing the amount due to the Exchequer from eight cents to 15 cents per cheque written, a measure that will yield an additional €9.2 million to State coffers in a full year.

"This move flies totally in the face of what we, the banking sector, thought we were about - moving away from paper-based transactions," said Mr Felix O'Regan of the IBF.

As the increases are Government-imposed duty and not bank charges, they do not require approval from the Director of Consumer Affairs. "The irony is that, if banks want to increase ordinary bank charges, they have to be cleared by the director and such requests are subject to a €30,000 application fee," he said.

"Yet, at a stroke, the Minister has increased the cost of banking by far in excess of any increase in the main charges brought in by the banks from 1994 to 2002. One has to ask who is doing a disservice to bank customers?"

The stamp duty measures will be raised by the financial institutions when they meet Department of Finance officials next week.