Rod Roman, tax partner at EY, comments on bank levy rates announced in the Autumn Statement
"The Chancellor's use of the word "permanent" in his short statement today confirmed the government's desire to ensure the £2.5 billion bank levy is here to stay. The Chancellor announced today the headline rate which applies to short term liabilities will increase from 0.078% to 0.088% starting next year. We expect the long term levy rates to be updated to reflect the change in the headline rate.
This is the third increase in bank levy rates in a row and confirms the government's primary objective for the bank levy is to raise a minimum amount of £2.5 billion per annum from the banking sector. The focus on raising a minimum level of revenue appears to be driving uncertainty in relation to the actual rates, which will cause concern amongst all major banks operating in the UK, in particular UK-parented banking groups who will bear this uncertain and growing cost on their entire global balance sheets.”