President Barack Obama on Thursday called for a new tax on Wall Street’s largest firms to cover an estimated $117 billion deficit in the government’s bailout, describing bank bonuses as ‘obscene’.

The president is adamant that every cent spent from the $700 billion Troubled Asset Relief Program (TARP) to bailout Wall Street firms, auto companies and mortgage holders be repaid. However, the proposed tax will need Congress’ approval.

"My determination to achieve this goal is only heightened when I see reports of massive profits and obscene bonuses at the very firms who owe their continued existence to the American people who have not been made whole, and who continue to face real hardship in this recession," the president said in prepared remarks.

The tax would not only help in reducing record deficits, it would also help to pacify the public now apathetic towards the banks. These institutions have not been lending as readily as they should, which continues to choke small businesses.

What Obama is proposing, is a tax of 0.15 percent on the liabilities of large financial institutions. The tax, which officials dubbed a "financial crisis responsibility fee," would affect only financial companies with assets of more than $50 billion. The fee would become effective on June 30, 2010, and be in effect for at least 10 years.

It would be mandatory for those firms, which account for about 50 institutions, to pay the tax despite that many did not accept any taxpayer assistance and most who did have repaid their loans.

The administration is projecting that 60 percent of the revenue would come from the 10 largest firms.

As expected, the banks are not happy with the proposal and have already voiced their opposition. Some are disgruntled that the tax would affect institutions that have repaid their loans or that did not take it to begin with.

Jamie Dimon, chief executive of JPMorgan Chase & Co., on Wednesday told reporters that "Using tax policy to punish people is a bad idea," adding that it was not fair for the financial sector to foot the bill for auto companies.

The idea, as expected, has been met with partisan response in congress, with Democrats lauding it and Republicans rebuffing it.

House Financial Services Committee Chairman Barney Frank, D-Mass, has come out in support saying “the financial institutions collectively, particularly the larger ones, caused problems by their errors – their errors of judgment, their irresponsibility, in some cases their skating around dishonesty."

But committee member Republican Rep. Jeb Hensarling of Texas dismissed the idea. “To think that banks will loan more money if you tax them is beyond economic ignorance.”