According to the Financial Times, the cap on the duty was originally intended to be limited to 15 per cent of an individual bank's profits, but companies which pay a restricted contribution in one year may have to shell out more in the following years.
"In economic terms it makes no difference whether the levy needs to be paid straight away, or partly immediately and partly in subsequent years," Germany's banking association stated. "We want to strengthen capital and this goes in the opposite direction."
Although funding raised by the one-off charge will be put towards a $91 billion emergency reserve which can be tapped to wind down troubled lenders, industry chiefs are understood to be dismayed at what they consider to be excessive taxes.
Speaking in the House of Commons today (January 12th 2011), British prime minister David Cameron claimed UK financial institutions would pay 11 per cent more in duties this year.
By Gary Cooper