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Obama prepares fresh tax on banks

The Obama administration, under increasing pressure from Democrats in Congress to take punitive action against banks, is readying a new levy on the finance sector that will form part of the budget to be presented in February.

Government officials say the detail of the levy remains unresolved but it is aimed at addressing rising anger against the banks, at a time when the sector is due to announce billions of dollars in new bonuses, and cutting the budget deficit.

The US Treasury has previously poured cold water on attempts to introduce a financial transactions tax, an idea put forward by Gordon Brown, UK prime minister.

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