Edited by John Raymond LaBrosse, Rodrigo Olivares-Caminal and Dalvinder Singh
Chapter 7: Tax and the City: The UK’s Proposals for a Bank Levy
7. Tax and the city: the UK’s proposals for a bank levy John Snape1 7.1. INTRODUCTION The issue of whether there exists some public interest, beyond the ‘natural’ operation of the markets, is the central ideological question in a world where the future shape of neoliberal society is gravely in doubt. Nowhere, perhaps, has this proposition been more vividly illustrated than in the debate about how governments, whether acting together or unilaterally, should legislate for the reform of financial markets. Questions have centred, to a large extent, on the vexed issue of whether a special levy should be imposed on banks, one which would reflect the systemic risks that the financial services sector presents to the developed economies of the world.2 Imposing such a levy is not, of course, the only possibility for the greater regulation of the banks, as the various contributions to this volume demonstrate. Discussion of the merits of a bank levy has weaved itself inextricably around the other, related yet distinct, questions, which have long preoccupied analysis of the deliberations of both the European Commission and the Basel Committee on Banking Supervision.3 Preeminent among these, of course, is the issue of how to strengthen banks’ ‘buffers’ of capital and liquidity, each of which gives rise to problems themselves shaped and prioritized by the feasibility of a bank levy. Regardless of the shape a bank levy might ultimately take, the nature and quality of the arguments, both for and against it, are of crucial importance for the...
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