EU commits to bank levy

THE European Union has told G20 members it is ready to crack down on the financial sector by committing to a global bank levy.

In a draft letter revealed yesterday EU officials wrote: “We are ready to cooperate with G20 members on globally coordinated principles for a levy on the financial sector.”

The move comes as European finance ministers prepare for a meeting this week, at which they will attempt to settle differences over how best to impose extra taxes on banks.

The International Monetary Fund (IMF) also yesterday threw its weight behind increased regulation by encouraging US and EU regulators to introduce higher capital requirements on banks deemed too big to fail.

The IMF is set to present bank levy recommendations to finance ministers of the Group of 20 most prosperous nations when they meet next week in Washington.

Yesterday, French finance minister Christine Lagarde said that a tax on banks could make them safer.

But not everyone agrees and many officials have called for clarity. One senior European diplomat said: “We need to define what we are talking about. There hasn’t been a full discussion yet at ministers’ level.”