Britain will lobby its partners among the Group of 20 industrialized countries to impose a systemic-risk tax on banks, Chancellor of the Exchequer Alistair Darling said Wednesday.
The levy would be applied only if international agreement can be reached, said Darling, who rejected the argument of the main opposition Conservative Party, which has said it would unilaterally impose the tax if it wins this year's election.
"I agree with all those who believe such a tax should be internationally coordinated," Darling told the House of Commons in his annual budget presentation. "Going it alone would cost thousands of jobs, not just in London but across the whole country."
Britain will seek other countries' approval for the plan before the G-20 finance ministers meeting in Washington next month, Darling said. The tax would be applied to "all financial institutions that might contribute significantly to systemic risk," the budget documents said, without explaining how they might be identified.
The money should be raised and used by national governments as general taxation, rather than held in a stand-alone fund or used as an insurance policy for institutions, shareholders or creditors, the documents said. The tax "must be brought forward quickly," Darling told lawmakers.
The Conservative Party, which leads in opinion polls, would introduce a tax on banks whether or not other countries follow, party leader David Cameron said in a speech on March 20. He did not give further details of how the tax might be levied.
Darling also set lending targets for Royal Bank of Scotland Group PLC, Britain's biggest government-owned bank, and Lloyds Banking Group PLC, which is 41% taxpayer-owned.
Royal Bank of Scotland and Lloyds have agreed to lend 94 billion pounds ($140 billion) to businesses over the next year, including almost half to "small and medium-size enterprises," Darling said.
"In return for support during the financial crisis, we've made banks accept their obligations," the chancellor told lawmakers.
RBS has the capital to meet the pledge, the Edinburgh company said in an e-mailed statement. The bank will make 50 billion pounds of gross new lending available and 8 billion pounds of net lending available for mortgages.
The government will also establish a "fast track" credit adjudication service so that those denied credit by banks can appeal against the decision, Darling said. The new service would have legal powers to overturn bank decisions, he said.
U.K. banks have paid 8 billion pounds ($12 billion) in fees and charges to the Treasury in return for the support they received from taxpayers, Darling said.
The tax on bonuses introduced in December's prebudget report has raised 2 billion pounds, more than double the forecast, he also said.
Labor unions said Darling should have increased taxes on banks and used the money raised to avoid cuts in public services.
Civil servants from the Public and Commercial Services Union, who were striking Wednesday over payoffs for laid-off workers, shouted "No cuts, no way, time to make the bankers pay" as Darling's car arrived at the House of Commons for the budget speech.