Conservative giveaway to big banks set to cost taxpayers £22 billion

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.

Liberal Democrat Scottish Affairs spokesperson Christine Jardine MP said:

“The Chancellor’s Autumn Statement is full of holes. Rather than support working families Jeremy Hunt is picking their pockets while letting the big banks off the hook.

“Prioritising bank profits over making working families better off is the perfect reflection of where the Chancellor’s sympathies lie.

“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 yet another sign of a government that is not on your side.

“Liberal Democrats will take every opportunity to put fixing the health service and tackling the cost of living crisis first.”

ENDS

Notes to Editors:

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)