Each EU Government Proposed to Levy Tax on Its Banks

The European Commission Wednesday proposed that each European Union government levy a tax on its banks and use the proceeds to create a fund dedicated to ensuring the "orderly failure" of troubled banks.

The proposal would create a European network of such funds that would follow the same rules, although the commission, the EU's executive arm, didn't provide details on how high the tax should be, Wall Street Journal says.

Details of the plan were scarce, with no word on how big the funds would likely be or exactly how they would be funded -- for example, through a tax on banks' profits or on the size of their balance sheets.

Under the plan, each member country would set up its own fund. However, there could be disagreement over the degree of autonomy countries would have in collecting the money and over how it could be spent, MarketWatch reports.

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