new york (Bloomberg) — Treasury Secretary Timothy Geithner, throwing cold water on a plan by congressional Democrats to tax financial transactions, said banks and other market participants would find ways to circumvent the expense.

"I have not seen the version of that that I think works," Geithner said in an interview on Bloomberg Television's "Political Capital with Al Hunt" that aired over the weekend. Firms are "going to move in a heartbeat to get around any tax like that".

The Treasury chief also predicted a "quite high" chance that the US unemployment rate will be lower than 10 percent in a year, and he called yesterday's Labor Department report showing the smallest monthly job loss in two years "progress but not good enough".

Geithner also continued to push Congress to pass legislation that would rewrite financial rules and said that the Obama administration was close to announcing a new tack for the $700 billion bailout. Geithner said he expects the Troubled Asset Relief Programme to get as much as $175 billion in repayments from banks by the end of next year.

The prospect of a so-called Tobin tax, floated last month by UK Prime Minister Gordon Brown, is already provoking nervous US financial companies to lobby for its defeat. Democrats, including Oregon Representative Pete DeFazio and Iowa Senator Tom Harkin, this week proposed taxing large transactions in stocks and derivatives. House Speaker Nancy Pelosi said the idea has a "great deal of merit".

In yesterday's interview, Geithner, echoing some of the banking industry's reasons for opposing a Tobin tax, said he was concerned it wouldn't be able to be adopted globally, making it harder to impose. He also noted that the tax may hit less sophisticated investors, instead of the big firms.

"There's a real risk that retail investors, who've got fewer choices, they end up bearing the cost of the tax," he said.