In the wake of the Global Financial Crisis, there is widespread international consideration of proposals to impose specific taxes (levies) on banks (and some other financial institutions). The UK has already done so in the budget of 22 June 2010 and the French and German Governments have also announced their intentions to impose some form of bank balance sheet levy. While some see such an impost as an ex post charge for the costs incurred by governments and national economies for excessive risk taking by banks which led to the GFC, most support is based on a forward looking view. Thus the IMF argues that even countries that provided little or no support to their financial sectors during the recent crisis should consider forward-looking contribution schemes.
This paper was prepared by Professor Kevin Davis, Research Director of the Australian Centre for Financial Studies.
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