Tax on bank bonuses raises £2bn
The Government's 50% bank bonus tax has already raised £2 billion for the UK public purse, the Chancellor revealed today.
Alistair Darling said the windfall tax - introduced on bank bonuses above £25,000 - had raised far more than the £550 million originally expected.
He reiterated support for a global levy on the banking sector, but said the UK should not go it alone in introducing a new bank tax.
In pledging to recover money forked out by taxpayers to help the banking sector, Mr Darling added that more than £8 billion in fees and charges had been received from banks in return for support during the financial crisis.
Cash raised by the one-off bank bonus tax will go towards a £2.5 billion growth package, announced today, to help small businesses.
The Government introduced the tax on all bonuses above £25,000 awarded between December 9 last year and April 5 this year.
It was revealed in the recent annual results reporting season that the "big four" banks alone had generated more than £650 million under the levy.
HSBC said on releasing annual figures that it will pay £232 million on the tax, while Barclays is paying £225 million and part-nationalised Royal Bank of Scotland is footing a £208 million bonus bill.
Revenues from the tax have also been boosted by the likes of international banks such as Goldman Sachs and JP Morgan which have significant UK workforces.
Mr Darling added that the Government will get back the money spent on bailing out RBS, Lloyds Banking Group and Northern Rock.
He said: "We will sell our shares in RBS, Lloyds and Northern Rock in a way that maximises returns to the taxpayer."
"We intend to get taxpayers' money back," he added.
The banking sector is meanwhile facing a further global tax, which is being worked on at an international level.
Mr Darling called for the levy to be brought forward quickly to address the mammoth amounts of public cash pumped into the sector around the world, while he also urged international reforms on the amount of capital reserves held by banks to prevent future bail- outs.
"We cannot continue with a situation where the banks are rewarded for taking excessive risk and the taxpayer foots the bill," said Mr Darling.
But any bank tax must be done on a co-ordinated international basis to prevent the UK's financial centre being disadvantaged, he stressed.
"Going it alone, as someone suggested, would cost thousands of jobs, not just in London, but also the whole country," warned Mr Darling.
However, he made it clear that penalties must not cripple the sector and its competitiveness: "There can be no return to business as usual for the banks. But we also must remember that their success is vital not just for the global economy but for Britain's future."