EY Comment: Will the small print in the Budget alter the bank levy burden?
19 March 2014
Jonathan Richards, Partner at EY, comments:
"The Government has outlined its intention to consult on a new bank levy charging mechanism under which banks will be put into bands depending on the size of their balance sheets, with a different rate set for each band.
"Currently only 30 - 40 banks are subject to the bank levy and more than half of that is paid by just four banks. Without full details, it is hard to speculate further, but the Budget announcement may suggest a wish either to share the burden across a greater number of banks or to alter the proportion of bank levy paid by UK banks as compared with overseas banks.
"If so, there is a balancing act to be performed. The UK banks already feel that they pay too much, whereas inbound banks feel that the levy is a disincentive to locate activities in the UK."
For more information on the 2014 Budget, visit the EY 2014 Budget page.