UK Government reveals details of bank levy

The UK Government has set out its plans for a proposed bank levy which it hopes will raise £2.5bn annually.

A consultation paper published by the Treasury says the levy on balance sheets will be introduced in January 2011, as first outlined in the emergency Budget in June. The levy will be set at 0.04% in 2011, rising to 0.07% in 2012, while there will be a reduced rate for longer-maturity funding set at 0.02% and rising to 0.035%. Three areas of banking will be covered by the levy: the global consolidated balance sheet of UK banking groups and building societies the aggregated subsidiary and branch balance sheets of foreign banks and banking groups operating in the UK the balance ...