The Chancellor announced in his autumn statement that the bank levy would increase to 0.088% from
In the autumn statement last week, the Chancellor announced measures that will mean that the Government will raise three times as much from cuts in child tax credits than they will raise from any additional taxes on the banks. Should he not hang his head in shame at the Government’s actions? When will they change course and stop their relentless, ruthless attack on those less well off in society?
Earlier this year, the Prime Minister announced that the high street banks would commit £200 million to the big society bank to try to fill the £5 billion shortfall currently faced by charities and the voluntary sector. To put it another way, that is just 1.4% of the £14 billion the banks have paid out in bonuses this year. What steps will the Chancellor take, including by providing further incentives, to ensure that those financial institutions commit more to community reinvestment?
The right hon. Lady should recognise that bank bonuses are a quarter of what they were when she was in the Cabinet. The banks are doing that. The previous Government were in office for 13 years. They had no idea about introducing a bank levy. This Government have taken the right steps to ensure that banks pay their fair share of taxes.
My hon. Friend will be aware that banks and financial services contributed more than £50 billion in taxes last year, but has he noted that this Government’s bank levy—the permanent levy—will raise more in one year than the previous Government’s payroll tax?
My hon. Friend is absolutely right. Of course, the previous Government said that the bank bonus payroll tax would be a one-off tax. This Government had the courage to go forward, and to say that we would introduce a bank levy unilaterally, which the previous Chancellor opposed. We are taking the tough action on taxing banks that the previous Government failed to take.