Canadian Financial Institutions to Fight Global Bank Tax

Canada is holding its stance against an International Monetary Fund proposal that would introduce a global bank tax to hedge against future financial meltdowns. The proposal calls for taxes on bank profits and compensations, as well as borrowing.

In an opinion article for London’s Financial Times, Canada’s leading financial institutions – the Toronto Dominion Bank, Bank of Montreal, Canadian Imperial Bank of Commerce, Royal Bank, Bank of Canada and the Bank of Nova Scotia – say that the proposed tax will not address the core issues that led to the global financial crisis in the first place. Instead they suggest that the IMF looks at Canada as a model.

Canada is up against the IMF and many European banks that favour the tax. In an in-depth report, Reuters quotes Canada’s Superintendent of Financial Institutions Julie Dickson as saying that Canadian banks’ performance during the global financial crisis should give them a stronger voice at the discussion table.

A Vancouver Sun report quotes Federal Finance Minister Jim Flaherty as saying that a tax now would be equal to punishing Canadian financial institutions for behaving responsibly, and he will oppose it even if Canada stands alone on the issue. Bank of Canada governor Mark Carney stands behind Flaherty’s position.
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