The question of additional taxes on banking institutions has recently been debated. At the same time, financial regulation in the banking sector is undergoing many changes aimed at strengthening financial stability. This chapter uses SYMBOL, a micro-simulation model of the banking system, to estimate contributions to systemic risk of individual banks under various future regulatory scenarios and compares them to their potential tax liabilities under alternative designs of Financial Activity Taxes and Bank Levies. The results show that when contagion is not avoided, all taxes perform about the same way. However, when contagion is avoided, bank levies outperform FATs.

Financial activities taxes, bank levies, and systemic risk

Zedda, S.
2014

Abstract

The question of additional taxes on banking institutions has recently been debated. At the same time, financial regulation in the banking sector is undergoing many changes aimed at strengthening financial stability. This chapter uses SYMBOL, a micro-simulation model of the banking system, to estimate contributions to systemic risk of individual banks under various future regulatory scenarios and compares them to their potential tax liabilities under alternative designs of Financial Activity Taxes and Bank Levies. The results show that when contagion is not avoided, all taxes perform about the same way. However, when contagion is avoided, bank levies outperform FATs.
9780262027977
Taxation; Banks; Financial Activity Tax; Bank levy; Systemic Risk; regulation
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Utilizza questo identificativo per citare o creare un link a questo documento: https://hdl.handle.net/11584/54324
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