Darling backs IMF bank tax plans

CHANCELLOR Alistair Darling has welcomed International Monetary Fund proposals for two new taxes on banks to fund future bailouts.

A levy would initially be charged at a flat rate then modified so riskier institutions were charged more, under the plans aimed at reducing the chances of a future global financial crisis.

A second “financial activities tax” would be levied on the total of the financial institutions' profits and the bonus pot and pay of their their staff.

The chancellor said: "These are important proposals and we should welcome them. The recognition that banks should make a contribution to the society in which they operate is right.

"Any agreement has to be international.”

Angela Knight, chief executive of the British Bankers Association hit out at the plans and suggested they could make Britain less competitive.

She said: "All taxes have an impact and more tax has more impact.

"The recommendations need to be carefully examined but we remain concerned about moves which would place the UK industry at a competitive disadvantage internationally."