Temporary Tax On U.S. Banks Projected To Raise $90 Billion
President Barack Obama is expected to announce on Thursday a “financial crisis responsibility fee.”
President Barack Obama is expected to announce on Thursday a “financial crisis responsibility fee” that would tax roughly 50 U.S. financial institutions for their roles in the financial meltdown, raising a projected $90 billion over the next 10 years, reports Financial Times. The move would accelerate the implementation of a repayment mechanism laid out in the Troubled Asset Relief Program from 2013 to this June.
The tax is to target firms with over $50 billion in assets, applying a fee of 15 basis points for the specified liabilities. Investment banks would be hit particularly hard by the levy since insured deposits are already subject to a fee from the Federal Deposit Insurance Corporation. The tax is expected to hit around 35 U.S.-based companies, as well as about 15 U.S. subsidiaries of foreign companies, with around half of the total number of firms hit projected to be banking institutions.