UK opposition commit to new tax on banks

David Cameron will commit the Tories to a new tax on banks as both main parties battle to convince voters they would claw back billions of pounds from the sector.

The Opposition leader will say the US-style measure is needed to ensure taxpayers are repaid in full for the bail-out of financial institutions.

His firm pledge comes amid renewed confidence of international backing for such a levy – although party sources indicated it would press ahead unilaterally with a more limited measure if not.

Chancellor Alistair Darling is expected to use next week’s Budget to signal the Government’s support for a global tax, although only as part of an international agreement.

The Financial Times reported that he would set out detailed options in Wednesday’s statement but would insist money raised should go into the Treasury coffers and not be used for an insurance fund against future collapse.

In a speech later, Mr Cameron is expected to declare that the banks are one of the “vested interests” he is determined to confront.

“We had the biggest bank bail-out in the world. We can’t just carry on as if nothing happened.

“In America, President Obama has said he will get taxpayers back every cent they put in. Why should it be any different here?

“So I can announce today that a Conservative government will introduce a new bank levy to pay back taxpayers for the support they gave and to protect them in the future.

“No, it won’t be popular in every part of the City. But I believe it’s fair and it’s necessary.”
Source: Press Association