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Speaking with CTV's Canada AM, Martin expressed his reservations about the bank tax that many of Canada's allies want -- including several major European powers and the United States -- to prevent taxpayers from having to buy out troubled financial institutions in future times of crisis.

From the get-go, Prime Minister Stephen Harper has campaigned hard against adopting such a tax, arguing that it will unfairly penalize Canadian banks who did not need to be bailed out during the recent economic crisis.

It's a rare occasion where the Conservative leader's views are in alignment with his immediate Liberal predecessor who views the banks tax as being "simply a non-starter."

Whether looking to banks in the West or elsewhere, Martin said the bank tax "doesn't really make any sense."

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Canada has strongly opposed bank levies and has received support from Russia, China, India and Australia in its effort to use other methods, such as tougher capital requirements, to make banks less prone to accident.

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The United States is generally in support of a bank levy, though any such tax would have to be approved by Congress and is unlikely to be included in the new Wall Street reform package. President Barack Obama six months ago proposed a 0.15 per cent levy on bank’s balance sheets (less insured deposits and core capital, known as Tier 1 capital). The levy would raise about $117-billion (U.S.) over 10 years.

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... the fact that the U.S. backed a levy of any kind was a tacit endorsement of the continental European approach to financial regulation. Wanting no part of a bank tax, Mr. Flaherty was forced to stitch together a band of allies that includes Brazil and Mexico to stand against its former allies.

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