Obama Plans to Raise $120 Billion From Banking Fees

Jan. 12 (Bloomberg) -- President Barack Obama plans to raise as much as $120 billion through a fee on financial institutions to help recoup losses from the Troubled Asset Relief Program and reduce the deficit, according to an administration official.

The White House hasn’t settled on the final structure of the fee and how to target the big banks that have returned to profitability, said the official, who requested anonymity.

The plan is to have revenue from the fee dedicated to deficit reduction and to cover the amount that the Treasury Department estimates it will lose from TARP, which is $120 billion. Details will be contained in the fiscal 2011 budget that Obama will submit to Congress next month, the official said.

The government’s $700 billion rescue plan contributed to a record $1.4 trillion deficit last year.

Tax experts, who discussed the possibilities before the president’s plan was disclosed, say all of the administration’s structural options, which include an income surtax, an excise tax, or a fee pegged on the value of assets or some other measure, are likely to be so porous that financial institutions would be able to sidestep most of them.

“Any new tax is always more complicated than the designers anticipated,” said Ed Kleinbard, the former staff director of Congress’ non-partisan Joint Committee on Taxation who is now a law professor at the University of Southern California. “When the numbers involved are this large, it’s very difficult to design on the fly.”

http://www.bloomberg.com/apps/news?pid=20601087&sid=aOPwYFDDBrxk&pos=1

 

.....which will then be passed on to the customer. Pretty soon, the banks will resemble check-cashing centers, which is fine by BHO as half of his constituency already frequents them.

Hopefully ACORN can sign me up for free healthcare as well while I wait...

 

Why not let insolvent banks go under?

That way, Government loses nothing.

And taxpayers don't subsidize Wallstreet endlessly,

 

Does this have anything to do with the financial transactions tax or Tobin tax?

 

So banks jack up fees on consumers. Subsequently government charges fees from banks.

What a nice and roundabout way to raise taxes.

 

he's making a mistake trying to reduce the deficit when he should be using the money to reduce taxes on small business.

I guess he hasn't taken a lesson from recent history. Reducing the deficit does no good because the next gddamned neocommie in the WH will sqaunder it all away. He should spend it all and let the neocommies come up with a solution for once.

 

government fee = government tax

Our "tax and spend" government in action. Call it a fee and all is kosher.