Commenting on France and Germanys call for an international bank levy, Mark Littlewood, IEA Director General said:
Britain needs to decide whether we want an economic recovery or not. If we do then we need to realise that it will only happen if we value the finance that supports private sector growth.
The call from France and Germany to introduce an international levy on banks is hardly a positive step in trying to rebuild Europes fragile economies. There has been support for this idea from all parties, with the Conservatives even going so far as to suggest that Britain should lead on it, but the cost of the tax to Britain will be far higher than the benefit.
Weve seen our politicians intervening to try and stimulate a recovery, but more important is the kind of culture we create. If we want Britain to become a place that thrives with commercial activity then we need to be seen as a place that values commercial activity, a levy on bankers bonuses, discussion of a Tobin tax and now a proposed levy on bank assets all contribute to the message that we dont want to be the financial hub of Europe and that we do not value cheap, efficient finance for consumers and firms. Its time we changed our tune.