Britain's Brown calls for possible tax on global financial transactions

Brown on Saturday surprised finance ministers meeting in the Scottish town of St. Andrews by urging them to consider a global levy, but the idea got a lukewarm response. Brown said such a levy, often called the Tobin Tax after the U.S. economist who devised it, would force financial institutions to be more responsible and was one of a range of measures that could help curb risky behavior.

Writing in the Financial Times on Monday, Brown said a new “social contract” was needed with banks to make them more responsible to society following the global financial crisis.

A levy was one of four options Brown said should be considered.

“A new contract requires a wide public debate, one in which banks themselves should be leading participants,” he said.

“It will not always be a comfortable discussion, but it is in my view an essential one.”

The United States appeared to shoot the proposal down in flames at the G-20 meeting that wrapped up on Saturday, with Treasury Secretary Tim Geithner saying his country had not changed its long-held opposition to an idea first floated in the 1970s.

British Chancellor Alistair Darling said on Sunday the tax was still worth studying despite the opposition. “It's a question of fairness,” he told the BBC.

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