EU commissioner proposes a bank tax

BRUSSELS, May 26 (UPI) -- The European Union commissioner for internal markets proposed an international effort to tax banks to avoid future taxpayer bailouts.

Commissioner Michel Barnier said it was "not acceptable that taxpayers should continue to bear the heavy cost of rescuing the banking sector," The New York Times reported Wednesday.

He proposed banks "contribute to a fund designed to manage bank failure, protect financial stability and the banking sector."

Bernd Brabander, representing a German banking group that includes Deutsche Bank, and Commerzbank, said the proposal was more sound than having countries setting up individual bank-funded reserves, as the levies and the rules would vary from country to country.

"If we had a patchwork, that would not help much," he said.

The proposal will be reviewed at the next EU summit. Should it prove to be acceptable there, the EU would take the idea to the next meeting of the Group of 20 Nations in Toronto, Canada, in late June.

British business secretary Vince Cable has already said the concept of taxing banks has merit, but the funds should be managed by separate nationalities, not by an international group.

The Netherlands is also likely to oppose the idea, the newspaper said.