Meeting on bank tax raises questions

Senate Finance staffers on Friday met with bank executives for informal discussions on creating a tax on banks and left the meeting frustrated as executives effectively questioned how the tax could work, sources said.

The conversation lasted more than two hours and focused primarily on President Barack Obama's charge to Congress to create a fee that would stop financial firms from taking on too much risk.

Financial executives seriously questioned the effectiveness of tax and warned it might create other headaches. They also asked about the underlying policy goal behind the initiative since, at least publicly, it seemed to punish firms from the recent collapse of the financial markets.

Apparently, no Republican members support the creation of the tax and Democratic members are unsure how to move forward on the issue.

Participants at the meeting included representatives from the American Bank Association, SIFMA, and executives from insurance companies that trade annuities.

It is unclear how the Senate will move forward on the tax.

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