Is there a possibility that Labour hike the Bank Levy instead of taxing interest on reserves?
It's cleaner, easier to explain to the populace and would be harder to circumvent (in my view at least). If enacted, I'd imagine this would impact NatWest, Lloyds and any other predominantly UK focused banks the most?
I think this is the real risk and the excess reserves remuneration taxing proposal may just have been cover to warm the sector up for something coming. I touched on this in Issue 59: "There is a danger in my view that Treasury will indeed seek to impose further taxes on the sector. If Treasury does press forward in this respect, I see the most likely moves as: i) a one-off increase in the surcharge (with the £100m allowance likely to be unchanged); and ii) an outright (structural) increase in the surcharge, perhaps with a commitment to review it annually (which is effectively what happens anyway). "
Is there a possibility that Labour hike the Bank Levy instead of taxing interest on reserves?
It's cleaner, easier to explain to the populace and would be harder to circumvent (in my view at least). If enacted, I'd imagine this would impact NatWest, Lloyds and any other predominantly UK focused banks the most?
I think this is the real risk and the excess reserves remuneration taxing proposal may just have been cover to warm the sector up for something coming. I touched on this in Issue 59: "There is a danger in my view that Treasury will indeed seek to impose further taxes on the sector. If Treasury does press forward in this respect, I see the most likely moves as: i) a one-off increase in the surcharge (with the £100m allowance likely to be unchanged); and ii) an outright (structural) increase in the surcharge, perhaps with a commitment to review it annually (which is effectively what happens anyway). "