Ministerial sources suggested there might instead be a further hike in the bank levy.
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The bank levy, in particular, will drive banking activity overseas, and banks will avoid most risk adjustments through accounting sleights-of-hand.
Many EU countries can object to an FTT, since the bank levy is the main bank contribution to bailout costs.
FORBES: European Union To Talk Bank Levy, Financial Transaction Tax
Labour backbencher John McDonnell urged ministers to review the possibility of incorporating a bank financial transaction tax within the bank levy.
He said that Banks would see their bank levy rise to compensate.
The bank levy was actually first proposed to all countries by the International Monetary Fund (IMF) as a type of insurance scheme.
U. for demanding the bank levy as a condition for the bailout.
Correspondents say the new plan may include nationalising pension funds of semi-public companies and limiting the bank levy to deposits above 100, 000 euros.
Chancellor George Osborne had already said the UK would compensate any British troops in Cyprus hit by plans to introduce a bank levy.
BBC: MoD flies emergency cash to Cyprus for British personnel
The bank levy approach focuses on banks and bailouts, whereas an FTT focuses on putting sand in the wheels of speculators in addition to banks.
FORBES: European Union To Talk Bank Levy, Financial Transaction Tax
The Labour leader called for the government to impose a tax on bonuses, which he claimed would raise more money than the bank levy introduced by Chancellor George Osborne.
This would have seen a bank levy on all deposits over 100, 000 euros in banks in Cyprus and a smaller percentage on deposits of more than 20, 000 euros.
But Tory former minister John Redwood, leader of his party's policy group on economic competitiveness, branded the bank levy a tax on lending money to businesses and individuals.
The new package of measures is still under discussion to reach a target of 5.8bn euros demanded by the EU and IMF, and may include a revised bank levy.
Even if it could be agreed, I'm not sure that a bank levy to extract 30bn euros from the financial system, in the name of "private sector burden-sharing", really fits that description.
The EU wants a bank contribution to bailout costs and it is focusing on the bank levy, which would set aside a pound of flesh to cover prior or future bank bailout costs.
FORBES: European Union To Talk Bank Levy, Financial Transaction Tax
Mr Osborne said the UK did not have prior knowledge of the original plan to impose a bank levy, which would have seen small depositors effectively charged 6.75% of their deposits to fund the bailout.
Finance ministers from the G20 killed off a proposal for a global bank levy after strong opposition to the idea from several nations, led by Canada, which has not had to nationalise its financial companies.
"We have demonstrated that the bank levy we have introduced does actually ensure that the banks pay a fair share in respect of the risks that they themselves pose to the wider economy, " he said.
So, what this bank levy does is, essentially, charge an insurance premium for the insurance coverage on offer: and charges it only on those deposits which are not already insured and paying an insurance fee under other schemes.
FORBES: Taxing Bank Profits: I Wish People Would Understand This
As MPs considered the Finance Bill, which enacts many measures in this year's Budget, at report stage on 5 July 2011, shadow financial secretary Chris Leslie said that a bank payroll tax could be incorporated within the government's bank levy.
Other announcements included an increase in the bank levy to 0.088% from 1 January and a 50% discount for social housing tenants who want to buy their own home - the proceeds of which would go towards building new affordable homes.
In a New York Times opinion piece entitled A Bank Levy in Cyprus, and Why Not to Worry, Andrew Ross Sorkin assured his readers that far from Armageddon the Cyprian banking crisis is unique and therefore nothing to worry about.
Although Chancellor George Osborne increased the bank levy in last week's Autumn Statement, the unions say the public sector is bearing the brunt of measures to rebalance the public finances with workers facing a new 1% cap on pay rises after the current two-year pay freeze ends in the Spring.
First, they must argue that the sudden bank account levy was absolutely necessary right now.
FORBES: Odd Cyprus Message: Levy Was an Absolute Necessity and It Will Never Be Repeated
F. may or may not use the bank deposit levy as a means of raising monies in future bailout schemes, but that is not the core issue.
The first question is whether the new plan will still involve any levy on bank accounts.
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