A “Tobin” style tax on financial transactions is not the best way to raise cash for bank bailouts, a senior official from the European Union’s executive body said on Wednesday.<\/p>\n
The G20 group of leading countries asked the International Monetary Fund at a meeting in Scotland last month to come up with options by April for a possible transaction tax, “insurance” levy or resolution fund paid for by banks.<\/p>\n
It would help refund taxpayers for huge bailouts and pay for future rescues.<\/p>\n
The European Commission, which participates in the G20, told a European Parliament hearing on transaction taxes it was not working on such a proposal, there were doubts about its impact, and several issues need clarifying.<\/p>\n
“It leads us to the clear conclusion that such as tax is not the right instrument. It’s not a secure instrument,” said Alexander Wiedow, a director in the commission’s tax unit.<\/p>\n