Written question asked by Lord Myners (Labour), in the House of Lords. It was answered by Lord Sassoon (Conservative) on Monday, 19 December 2011.

Banking: Levy

Question: To ask Her Majesty’s Government whether the rate of tax applied under the bank levy will be adjusted regularly to achieve a monetary tax yield; and whether they plan to use this approach for any other taxes.

Answer: The Chancellor of the Exchequer keeps all taxation under review. The Government believe that banks should make a fair contribution in respect of the potential risks they pose to the UK financial system and wider economy. Following the Chancellor’s announcement in his June 2010 Budget, we introduced a bank levy from 1 January 2011. This is a permanent levy on banks’ balance sheets, expected to raise at least £2.5 billion each year. In his Autumn Statement, the Chancellor announced an increase in the levy rate from 1 January 2012, with resulting revenues for the life of this Parliament expected to exceed £10 billion.

Secondary information