The chief executive of the US’ third largest bank has said UK bank tax rates are worrying. And that’s before Burnham gets his hands on them…
Jane Fraser is CEO of Citi and Scottish herself. She said in London today that UK taxation of banks was harsher than New York, Paris, Frankfurt, and Dublin, and pointed out that “money votes with its feet.” She added that US perception of the UK in this sector was “a bit diminished from what it used to be.” She said:
““But money speaks with its feet. [Such a tax] makes it an easier decision not to invest in London… This is an important country – huge talent, great infrastructure, a strong history of capabilities and reliability. I think the intent from most of the business community vis-à-vis the UK is we want the UK to succeed…
We want to see some of the things that have held the country back getting taken down by the government and the country fulfilling its potential. That is the overwhelming sentiment from the business community.”
Unions are calling for a “windfall tax” – raising the bank surcharge from 3% to anywhere up to 35% to raise billions. Angela Rayner has called for the same thing privately while last in government. The surcharge is on top of the usual 25% corporation tax rate…
Fraser’s warning follows Jamie Dimon – JPMorgan chief – suggesting that the firm would backtrack on its £3 billion London office plans if there was another rate hike. A windfall tax would be a sniper bullet to the sector – the surcharge should be scrapped altogether…
UPDATE:
Asked if it can rule out hike to bank taxes at the Budget, the Treasury declined to do so.
“Decisions on tax are a matter for the chancellor to set out at fiscal events, rather than routinely commenting on proposals made.”
Burnham has ruled out other tax changes, like stamp duty.
Burnham confirms he spoke to Trump last night about drilling in the North Sea:
“I indicated in the phone call that we had a week last Monday that I would take a pragmatic approach when it comes to the North Sea, and that is my intention as we go forward from here. There is a resource there. When people are struggling, we can’t ignore that. Hence, me indicating that to the president…”