windfall tax on uk banks: UK banks face new profit tax as shares drop after IPPR proposal
Treasury did not comment on the tax speculation, but the government said that the city was “bureaucracy cut” for the city of London and gave priority to financial services. On Friday, Natwest and Lloyds shares fell more than 4% in early transactions, while Barclays fell over 2%. At the end of the day, Natwest is still over 4%, over 3%of Lloyds, and more than 2%, as Barclays reported by the BBC.
Banks Protest New Tax
Lloyds CEO Charlie Nunn warned that tax increases will conflict with their efforts to increase the UK economy and financial services. IPPR, a left -leaning thinking tank, said that the Bank of the UK is required to taxpayers of the Bank of England (QE) that a bank tax is necessary because it cost £ 22 billion per year. QE began to support the sector by acquiring government bonds after the financial crisis and in 2020.
The UK Bank has added new electronic money to the accounts of commercial banks. The bank began to reversed QE in 2022, but is still losing money because interest rates to deposits are higher than the interest earned in bonds. The bank also loses money by selling money under purchasing prices. IPPR, this is like a “state subsidies to commercial banks”, the commercial bank profit, according to the BBC report, the pandemi before the $ 22 billion, he said.
Tax can save £ 8 billion
The tax proposal comes as the chancellor Rachel Reeves prepares the budget and meets his own rules on taxation and expenditures. IPPR assistant director Carsten Jung said the Bank and Treasury prevented the “implementation of quantitative expansion”. Jung, families struggling with costs flowing directly to banks and “bank shareholders billions of pounds of controls,” he added, he added.
Jung said that the loss of 22 billion pounds to the BBC’s Today’s program is the same as the annual budget of the home office. IPPR said that a targeted bank tax will take back some losses, will still leave banks with high profits, and the government could save £ 8 billion a year. British Finance, a financial service organ, warned that a new tax will make England less competitive, according to the report of BBC.UK banks. British financing, a new tax will contradict the government to support financial services, he said. AJ Bell Investment Director Russian Mold said the UK stock exchange fell because investors are worried about future bank profits, dividends and reputation. The Treasury said that the city increased its competitiveness and wanted the UK as “the number one target for financial services until 2035”. The government claims to be pro -business and says that financial services are the center of economic growth plans. Chancellor Rachel Reeves has been working to win the city since the Labor Party came to power.
In July, Reeves announced “Leeds reforms için to encourage investment and to facilitate the rules after the financial crisis, which banks said it was very strict. According to the BBC’s report, Reeves face pressure to find more income after limiting budget flexibility after reversing welfare savings and winter fuel allowance deductions.
FAQ
Quarter. Why did British bank shares have fallen recently?
Stocks fell after a new tax call for bank profits that could increase £ 8 billion per year.
S2. What is the recommended bank tax?
The tax is recommended to save the taxpayer’s money lost from the Bank of the Bank of England’s QE program.
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