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Germany's CDU Favours Bank Tax

Thursday, March 11, 2010

Germanyís Christian Democratic Union (CDU) party are eager to levy a special tax on banks as a contribution to the cost of rescuing the financial sector.

According to the partyís deputy leader, Michael Meister, the Federal Finance Ministry is currently drafting Ė as a matter of priority Ė a new banking regulation, which is due to be presented in May ahead of the G20 meeting in Berlin.

The Christian Social Unionís (CSU) General Secretary, Alexander Dobrindt, has also emphasized the need to bring the financial sector to account. Dobrindt has called for the introduction of a flat rate 0.1% tax levied on the balance of banks. Banking bonuses should also be taxed, he added.

The recent comments have provoked outrage from the CDUís coalition partner, the Free Democratic Party (FDP). Rejecting the idea, the FDPís General Secretary, Christian Lindner, has explained that not all banks are responsible for the crisis. Reputable institutions should therefore not be held to account, he added. Lindner has also ruled out the idea of a financial transactions tax.