Alistair Darling hails IMF's call for new tax to fund future bank bailouts

Published on Wednesday 21 April 2010 01:24

CHANCELLOR Alistair Darling last night welcomed reports that the International Monetary Fund is calling for two new taxes on the banks to pay for future bailouts.

The IMF watchdog is calling for a "financial stability contribution" to pay for the "cost of any future government support to the sector", according to a leaked report.

The levy, which would be imposed on all financial institutions, not just banks, would be charged at a flat rate, but would eventually be modified so riskier institutions are charged more.

A second "financial activities tax" would be levied on the total of the firm's profits and what they pay staff, plus bonuses.

The report, which will form the basis of a submission to the G20 summit in June, states international co-operation in the introduction of the new levies would be "beneficial".

"Countries' experiences in the crisis differ and so do their priorities as they emerge from it. But none is immune from the risk of a future – and inevitably global – financial crisis," it said.

Mr Darling said they were "important proposals" and backed Labour's position that any tax on the banks should be levied internationally.

"The recognition that banks should make a contribution to the society in which they operate is right," he said.

Liberal Democrat treasury spokesman Vince Cable also welcomed the report.