Banks pay additional £40 billion in taxes
The Government has introduced £40 billion in additional bank-only taxation over a period of a decade. According to the British Bankers’ Association (BBA) from 2010-2020 banks will have faced an additional £4 billion a year in taxes on top of the other taxes that they already pay such as Corporation Tax, employment taxes, irrecoverable VAT and business rates.
The Summer Budget introduced a further additional tax that is only payable by banks (an extra 8% Bank Corporation Tax Surcharge) and the BBA points out that this was the fifth new bank-specific tax measure introduced in as many years.
While the Chancellor also announced a series of reductions in the Bank Levy over the next six years, the Summer Budget will still add a further £1.7 billion of tax to the banking sector over the same period. The Bank Levy was paid by 30 banks but the new tax will be levied on hundreds of banks and building societies.
Commenting, BBA Chief Executive Anthony Browne says: “Banks expect to pay their fair share of tax. But they are concerned that they are being singled out for new punitive taxes every year. This makes it harder for banks – the UK’s biggest export industry – to lend to businesses and create new jobs.
“The new Bank Corporation Tax Surcharge will undermine competition by creating an additional new tax for lots of smaller banks.”