Robbing Banks Won’t Make Europe’s Economy Stronger

Some European governments looking to raise tax revenue are following the (perhaps apocryphal) logic of American stick-up artist Willie Sutton: Go after the banks, because that’s where the money is. It’s an approach that’s likely to leave the whole European Union worse off.

This week, Italian Prime Minister Giorgia Meloni’s cabinet approved a surprise 40% “extra profits” tax that could cost the country’s banks more than €3 billion ($3.3 billion), and that immediately knocked some €10 billion off their market value. Last year, Spain imposed its own “windfall” tax with the aim of raising some €3 billion over two years. Other countries — including Estonia, Latvia and Lithuania — are considering similar measures.