UK banks face £2bn tax pain in budget
Published 21/06/2010 | 05:00
UK Chancellor George Osborne will force banks and savers to pay more tax in his first budget tomorrow, which will map out an austerity plan aimed at closing Britain's record budget gap within five years.
Mr Osborne said the "pain" of the biggest spending squeeze in 30 years would be spread over the lifetime of the current administration and that his plans "will put beyond doubt" the British government's resolve in filling the budget hole.
He also vowed to spread the pain evenly throughout all parts of society. "The package that I announce on Tuesday will be staggered over the parliament," Mr Osborne told the BBC's 'Sunday AM' TV programme.
His five-year austerity plan will set the overall size of the budget while leaving details on where the spending reductions will come until the autumn.
Mr Osborne yesterday said it remained a "good rule of thumb" that cuts account for 80pc of the consolidation and that tax increases make up 20pc.
Part of the effort to sell the austerity measures to voters will include a levy on banks' assets or liabilities that will raise at least £2bn (€2.38bn) a year, according to sources. (Bloomberg)