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Speculation over cut to bank surcharge

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The Financial Times reports (20 September) that John Glen MP, City minister, has said Britain’s financial services sector competitive will benefit from ‘competitive tax rates’, potentially paving the way for a Budget cut to rate of the corporation tax surcharge on banking companies.

The chancellor was ‘thinking very carefully’ about tax rates for financial services ahead of his October Budget, Glen said. ‘To be competitive, we have to have competitive tax rates and that’s what’s on the chancellor’s mind at the moment.’

Commenting on Twitter, Dan Neidle, tax partner at Clifford Chance, said: ‘This will inevitably be criticised but it is the right thing to do. The bank surcharge was introduced so banks didn’t get the benefit of corporation tax cuts. With the corporation tax rate going up to 25%, an additional 8% on banks is hard to justify.’

Issue: 1546
Categories: News