Osborne announces bank levy increase

Chancellor George Osborne has announced an increase in the bank levy of £800 million to be charged in 2011.


Chancellor George Osborne has announced an increase in the bank levy of £800 million to be charged in 2011.

Chancellor George Osborne has announced an increase in the bank levy of £800 million to be charged in 2011.

The change will increase the revenue brought in by the levy to £2.5 billion from £1.7 billion.

It is not yet known whether the move will jeopardise Project Merlin, the initiative to make banks agree to new lending targets for UK businesses.

Edward Rimmer, UK chief executive at Bibby Financial Services says, ‘Even if the proposed terms of Project Merlin come to fruition, whether the banks will actually commit to lending this sum is another question altogether.’
 
Adds Rimmer, ‘Despite good intentions, previous experience would suggest that other government initiatives to support funding for small businesses have not been successful.’

Andrew Murray, partner at Bargate Murray Solicitors adds, ‘The government has been desperately trying to persuade the banks collectively to finance small businesses and thereby power the growth the economy needs.  The banks say they are doing a lot of SME finance business, but they are not convincing enough.’
 

Related Topics

Project Merlin

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