WASHINGTON: The President Barack Obama proposed a broad new tax on financial firms with more than $50 billion in assets, a proposal that is unlikely to advance in Congress but underscores Wall Street’s continued status as a political punching bag.
The White House said the new fee would discourage excessive leverage, or borrowing, by taxing the liabilities of about 100 big financial firms, including banks, asset managers, broker dealers and other companies.
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And furthermore it would raise an estimated $112 billion over 10 years to fund other priorities, such as tax breaks for middle income workers.
The White House said in its proposed budget for the fiscal year that starts next fall that even with the end of too big to fail, excessive leverage still creates risks for the broader economy. The fee is intended to discourage excessive risk taking by financial firms, who were key contributors to the recent financial crisis.
