Print

A new bank payroll tax applies from 9 December 2009.

 John Whiting, Tax Policy Director of the Chartered Institute of Taxation, said: 

“This sounds like some of the wartime strictures on travelling – the Chancellor wants the banks to think hard before they pay a bonus. Any significant ones that go ahead will find something of a tax bomb en route. 

“It does sounds more of a controlling measure than a tax-raising one: we need to see the detail but the obvious thought people will have is that it may be possible to sidestep the measure by waiting a year. 

“The Treasury will face some major practical issues in framing this law. Defining a bonus will need a lot of care; so will defining banks – or is this a measure that could impact all businesses? That may be necessary to manage possible challenges under human rights or anti-discrimination laws. As with all tax changes there is a risk of unintended consequences.”