President Obama has called on Congress to tax the largest banks to ensure that taxpayers won’t lose anything as a result of the federal bailout of the financial, auto and insurance industries over the past year. The “financial crisis responsibility fee” would target major institutions. It would be levied on those that were the main contributors to the financial crisis and the most significant beneficiaries of the extraordinary actions taken by the Federal Reserve and the Treasury Department. President Obama, who believes that banks should tap their bonus pools to pay the fee, stated:
My commitment is to recover every single dime the American people are owed. We want our money back and we’re going to get it. If these companies are in good enough shape to afford massive bonuses, they are surely in good enough shape to afford paying back every penny to taxpayers. I’d urge you to cover the costs of the rescue not by sticking your shareholders or your customers or fellow citizens with the bill, but by rolling back bonuses for top earners and executives.
The President’s announcement came as banks were set to pay out tens of billions of dollars in bonuses. 0:00 /3:39Goldman’s image crisis If passed by Congress, the fee would take effect on June 30 and is estimated to raise $90 billion over ten years. More than 60% of the money will come from the ten largest financial institutions. If the fee ends up raising more money than is needed to fully repay the bailout money, the additional funds would be used to help improve the U.S. fiscal position, which was worsened by the crisis.
The administration estimates that roughly 50 companies will have to pay the fee, of which as many as 27 would be banking institutions. Roughly 35 would be U.S. companies and the rest would be the U.S. subsidiaries of foreign companies. This appears to be a good program and hopefully it will be enacted and put into effect.
Contact us today for a free legal consultation with an experienced attorney.
Fields marked *may be required for submission.
If you would like to subscribe to the Jere Beasley Report digital edition, simply visit our Subscriptions page and provide the necessary information or call us at 800-898-2034.
Attorney Advertising - Prior results do not guarantee a similar outcome.