No consensus as UK sets out bank tax

21 Oct 2010

The UK government this week introduced draft legislation for a bank levy that it hopes will raise £2.5bn each year by 2014, but has yet to say at what rate it will be charged. And although the proposals attempt to address industry worries over double taxation, bankers remain nervous while there is no international consensus.

The levy, to come into force from January 2011, would be applied to the liabilities of UK banks and the UK subsidiaries of foreign banks, subject to various exceptions.

It is structured to incentivise longer term funding, with a higher rate for wholesale liabilities of under one year. ...

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