France and Germany on Tuesday committed to levying a fee on banks to shield taxpayers from the cost of resolving financial crises and said they would ask other countries to join them. Britain earlier announced that it is going to impose tax on banks. The proposal comes ahead of next week's summit of Group of 20 leading nations, to be held in Toronto. In a joint statement, the three countries say financial institutions should make “a fair and substantial contribution” to reimbursing governments for bailing out banks in the wake of the global economic crisis. The countries said they were each proposing their own legislation, but that all would have the same goal. “All three levies will aim to ensure that banks make a fair contribution to reflect the risks they pose to the financial system and wider economy, and to encourage banks to adjust their balance sheets to reduce this risk,” read a proposal released by Berlin's Finance Ministry. Germany declared its intention for such a tax in March and is drafting legislation to go to parliament before the summer recess, while British Treasury chief George Osborne announced its version on Tuesday. France said it will present the details of its bank tax in the coming budget.
