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UK banks anticipate tax increases in upcoming Budget
Overview
Senior banking executives have told the BBC they expect the sector to face tax increases in the upcoming Budget. Following substantial profits in the first half of the year, trade unions and other groups have called for additional taxes, though industry bodies warn that higher levies could harm UK competitiveness and investment. Potential measures discussed include returning the bank surcharge to its previous level of 8%, altering the bank levy, or placing a temporary moratorium on banks using historical losses to offset profits.
Key points
- Senior banking executives expect the sector to be targeted for tax increases in the upcoming Budget.
- The UK's four biggest banks made approximately £15bn in profit during the first six months of the year.
- UK Finance warned that further bank taxes would weaken competitiveness, discourage investment, and hinder job creation.
- Potential options for the chancellor include raising the 3% bank surcharge back towards its previous 8% level or halting the use of historical losses to offset tax bills.
- Foreign bank executives, such as JP Morgan's Jamie Dimon, have previously warned that the UK already maintains one of the highest banking tax burdens globally.