Merkel says will lobby G20 for financial markets tax

18th May 2010, Comments 0 comments

German Chancellor Angela Merkel said Tuesday she would push for an international tax on financial markets during a summit of G20 leaders next month.

"Germany will defend (the idea of) a tax on financial markets at the G20," she said during a joint press conference with her Austrian counterpart Werner Faymann.

"The important thing is to reach an international agreement. Germany is to use all of its strength. If that does not work then a solution will have to be found at the European level," she said.

European Commission chief Jose Manuel Barroso urged EU leaders in a letter last week to take up the cause of an international tax on financial institutions at a G20 summit on June 26 and 27 in Toronto.

Finance ministers from the G20 group of leading developed and emerging economies last month asked the International Monetary Fund to weigh levying taxes on big banks to help cut risk and pay, thus avoiding possible financial failures.

While Washington and Europe have pushed for financial sector tax, Canada has led opposition to the idea, refusing to impose a charge on its institutions because its banks largely steered clear of crisis thanks to prudent risk taking.

IMF experts say the taxes must be coherent among all G20 members to prevent banks from avoiding them by moving operations to countries where the levies were not applied.

© 2010 AFP

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