Bank Levy hike offset by corporation tax cut

City A.M. Reporter
Britain's banks will not end up paying higher taxes overall as a result of the Budget, as the government's planned hike to the bank levy will be offset by a cut in corporation tax, the British Bankers' Association (BBA) said.

Chancellor George Osborne said in his Budget speech on Wednesday that he would increase the rate of the bank levy to 0.105 per cent from 0.088 per cent from next January, although corporation tax will be cut.

"The government has previously said that it both wants the bank levy to raise a specific amount - £2.5bn - and that any reduction in corporation tax will be offset by an increase in the levy," said BBA chief executive Angela Knight.