President Obama is considering a new fee on financial institutions to help reduce the federal deficit, although the details remain unclear, according to a report first disclosed on Politico.
According to the New York Times:
The bank fee would recover some of the money that taxpayers put up to bail out the financial system after its near-collapse in the fall of 2008, a rescue effort that has contributed to the largest annual budget deficits since World War II. Obama is expected to included the fee when he releases his budget plans in February.
The White House is under pressure to crack down on Wall Street risk-taking and excesses as the financial sector heads into a bonus season that is predicted to be one of the most generous in years.
Some senior Administration officials, including Treasure Secretary Timothy Geithner, have opposed such taxes, fearing any financial levy would be passed on to bank customers and that a bonus tax could be skirted by top bankers.
The European Union has called for a global financial transactions tax and stockpiling revenues to finance any future bailouts. Separately, Britain and France have proposed a large tax on financial executives' bonuses.
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