Challenger banks slam bank levy
The call follows last week’s budget in which Chancellor George Osborne revealed plans to force banks to pay an 8% surcharge on all corporate profits after 1 January 2016.
The Times reports that one challenger bank chief executive who refused to be named has said the move will penalise smaller lenders, adding that the threshold on profits should be raised from £25m to a minimum of £250m.
A group of 15 smaller lenders slammed the proposals, warning Osborne that charging challenger banks the same levy as the large high street banks could prevent them from lending to SMEs, cutting finance available to businesses by £10bn.
Anthony Browne, chief executive of the British Bankers’ Association, said: “The new bank corporation tax surcharge will undermine competition by creating an additional new tax for lots of smaller banks.”
Paul Lynam, chief executive of Secure Trust Bank, added: “The challenger banks are being hung out to dry for the benefit of the big boys, which seems hugely unfair.”
Speaking in the budget last week Osborne said: “By getting this balance right it means we’ll raise more from the banks this parliament, but at the same time make our country a more competitive place.”