Britain bails on Obama tax plan

Treasury developing own bank tax

Don’t expect Britain to duplicate U.S. President Barack Obama’s new tax on banks that were bailed out by the government. Instead, Britain has decided to implement a one-time 50 per cent levy on all bank bonuses above $40,700, and has also introduced a new 50 per cent tax rate for top earners. Obama plans to impose a tax of 0.15 per cent on the liabilities of large financial institutions in an attempt to recoup at least $90 billion of taxpayer money. London Mayor Boris Johnson expressed fears that thousands of high-earning bankers would flee London because of the taxes on bonuses, a threat which New York Mayor Michael Bloomberg said could occur on Wall Street as well. British Prime Minister Gordon Brown has called on other countries to develop similar bonus taxes to make the policy more effective.

CBC News