The Congressional Budget Office has proposed an annual fee of 10 basis points on the government-sponsored enterprises' arbitrage profits.

The proposal to charge Fannie Mae, Freddie Mac, the Federal Home Loan Bank System, and Farmer Mac was sent to Congress on Monday. The fee would apply to the GSEs' portfolios of debt securities.

The CBO said the plan would save the government $550 million next year, $2.8 billion over five years, and $5.5 billion by 2009. "The fee would reduce the competitive advantage that GSEs have in holding debt securities," the report said.

The plan was among several listed in a report on spending and revenue options. Another proposal would require the GSEs and Sallie Mae to register their securities with the Securities and Exchange Commission, which would amount to a charge of 3 basis points for securities issued in 2000.

This was first proposed in 1992 by the Federal Reserve and the Treasury Department, which projected savings of $259 million next year, $1.3 billion over five years, and $2.1 billion by 2009.

Fannie Mae and Freddie Mac have fought such fees, characterizing them as taxes on homeownership.

Subscribe Now

Access to authoritative analysis and perspective and our data-driven report series.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.