European bank tax to pay for future crises

The European Commission has unveiled plans to tax banks to make them pay now for future crises.

Michel Barnier, the European Union commissioner in charge of an overhaul of financial services, promised new rules across the EU by next year.

Banks’ assets, liabilities or profits would be taxed with the money going into an emergency crisis fund.

Barnier told euronews: “What the commission is suggesting is both fair and simple: prevention rather than fixing things afterwards, making sure the taxpayers don’t have to come up with the cash. It’s an idea the bankers should approve of, we are proposing ways of dealing with this that they usually agree with – early warnings, alerts, supervision – which can prevent bankruptcy or liquidation.”

The move set the stage for a showdown on the issue at a meeting of G20 world leaders in June.

France and Britain, Germany, the European Commission and the US all have different views on how the money should be used.

Canada, whose banks suffered less in the crisis, opposes such a levy.

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