Bigger tax on British banks on way

THE British government will tax banks’ balance sheets at a higher rate than first proposed, raising almost £9 billion (€10.68bn) over the next four years.

Starting on January 1, the government will charge 0.05% instead of the 0.04% announced in June, the Treasury said in a statement. The rate will rise to 0.075% from 2012 rather than 0.07%.

The rate is being increased so that the Treasury can hit a revenue target of £2.5bn a year from the levy to help Prime Minister David Cameron narrow the record budget deficit. The tax will apply to banks with revenue of more than £20bn.