By David Lawder and Andrea Shalal
WASHINGTON (Reuters) -U.S. Treasury Secretary Janet Yellen and British Finance Minister Jeremy Hunt signaled support on Thursday for a European Union plan to impose a windfall tax on profits generated by frozen Russian sovereign assets to help finance the reconstruction of Ukraine.
A Treasury spokesperson said Yellen called the EU plan a "sensible" proposal.
Yellen, who discussed frozen Russian assets with Ukrainian officials during her visit to Kyiv in February, told Bloomberg News reporters and editors that Washington was discussing the idea with the EU, the spokesperson said.
Hunt told Reuters in a telephone interview from Los Angeles that he supported the EU's idea of diverting interest earnings from the assets to Ukraine's reconstruction.
"We have to find a way that doesn't have unintended consequences," Hunt said. "And I think the most interesting discussions are really about how to use the interest income generated by (frozen) assets to go towards that reconstruction without actually seizing the assets themselves."
But Hunt said it was important to ultimately force Russia to bear the costs of reconstruction of Ukraine as a consequence of its invasion and "to make it clear to Russia that those assets are frozen until there's a fair settlement made with the reconstruction costs."
Yellen has repeatedly voiced support for Ukrainian demands that Russia should pay for the damage it has done to Ukraine, but has also pointed to significant legal obstacles halting moves to fully seize the $300 billion in Russian central bank assets frozen by sanctions.
EU officials have estimated that the windfall profit from Russia's frozen assets in Europe could provide 3 billion euro ($3.27 billion) a year to rebuild Ukraine.
(Reporting by Andrea Shalal in Washington and Lavanya Ahire in Bengaluru; Editing by Christopher Cushing)