Global bank tax plan gaining momentum

THE Chancellor yesterday claimed that radical plans for a global transaction banking tax were gaining international support.

Alistair Darling said governments were becoming increasingly interested in imposing a so-called "Tobin" tax on banks – a global levy that would enable the creation of an emergency fund to prevent a repeat of the bail-outs that have cost the taxpayer millions.

"I think it's very, very important we ensure that we reduce the risks and also at the same time that we do what we can to ensure that banks can make a proper contribution to the society in which they live," the Chancellor said. "One of the ways you can do that is if you can get agreement on an international tax."

The Tobin tax was first raised by Gordon Brown at the meeting of G20 finance ministers in St Andrews last autumn. But the suggestion was shot down by Barack Obama's administration.

But Darling said it was something "which a lot of governments are now becoming much more interested in than they were".

Darling also gave a scathing analysis of the banks' behaviour.

"Some bankers just fail to understand that they live in the same world as the rest of us. Most people understand that, at a time when other people are pulling in their belts, they ought to show some restraint."