Conservative giveaway to big banks set to cost taxpayers £22 billion
EMBARGO: Immediate Release
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Conservative cuts to Bank Surcharge and Bank Levy to total £22bn over next 6 years, Liberal Democrat analysis of the OBR’s Autumn Statement data has shown
The Lib Dems are calling on the Chancellor to reverse Conservative tax cuts to the banks, as the party’s analysis of new OBR figures shows that the cuts will total £22 billion over the next six years.
Jeremy Hunt cut the Bank Surcharge from 8% to 3% in April this year, even as he increased taxes on millions of struggling families by extending the freeze in the Income Tax personal allowance and higher-rate threshold.
It follows Conservative cuts to the Bank Levy every year from 2016 to 2021, and means that the two bank taxes are forecast to raise a combined £2.4 billion next year, down from £4.7 billion in 2016-17 – a 60% real-terms cut.
Analysis by the Liberal Democrats shows that banks will pay £22 billion less over the next five years than if revenues from the Surcharge and Levy had been maintained at 2016-17 levels in real-terms.
Sarah Olney MP, Liberal Democrat Treasury Spokesperson, said:
“The Chancellor’s Autumn Statement has utterly unravelled. Working families are going to have their pockets raided by Jeremy Hunt’s stealth taxes whilst the big banks are let off the hook and given a £22 billion tax cut.
“Jeremy Hunt could at least be honest with people and say that he is prioritising bank profits over making working families better off.
“As the NHS prepares for a winter crisis, sewage is pumped endlessly into our rivers and households have to choose between heating and eating, this Conservative government has chosen banks over people. It is a pathetic and frankly insulting offer to the country.”
ENDS
Notes to Editors:
Public sector receipts from bank taxes (£bn):
2016-17 | 2023-24 | 2024-25 | 2025-26 | 2026-27 | 2027-28 | 2028-29 | 6yr total | |
Bank Levy | 3.0 | 1.2 | 1.2 | 1.2 | 1.2 | 1.2 | 1.2 | 7.2 |
Bank Surcharge | 1.7 | 1.6 | 1.2 | 1.2 | 1.3 | 1.3 | 1.3 | 8.0 |
TOTAL | 4.7 | 2.8 | 2.4 | 2.4 | 2.5 | 2.5 | 2.5 | 15.2 |
GDP deflator | 94.9 | 119.3 | 121.3 | 123.3 | 125.3 | 127.6 | 130.0 | |
Total if 2016-17 levels maintained in real terms | 5.9 | 6.0 | 6.1 | 6.2 | 6.3 | 6.4 | 36.7 | |
Difference | -3.1 | -3.5 | -3.6 | -3.7 | -3.8 | -3.8 | -21.5 | |
Real-terms cut since 2016-17 | 52.5% | 59.5% | 59.8% | 59.8% | 59.9% | 60.2% | 58.7% |
Sources:
2016-17 revenues from ONS, Public sector current receipts
All other data from OBR Economic and fiscal outlook – November 2023 (p152, Table A.5)
