The emergency budget announced on 22 June includes specific measures affecting the financial services industry. A bank levy on banks' balance sheets from January 2011 will apply to:
- the 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; and
- the balance sheets of UK banks in non-banking groups.
The levy will apply only where defined aggregate liabilities are £20 billion or more, and will probably be an initial 0.04% in 2011 rising to 0.07%. HMRC will administer the levy, which the Government intends to use to encourage banks to move to less risky funding profiles. The French, German and UK Governments have published a joint statement saying they all commit to introducing a levy. The Government also confirmed the Independent Commission on Banking will look at reforming remuneration structures and unacceptable bonuses, and the Government and FSA will explore the costs and benefits of a "financial activities tax" and a remuneration disclosure regime. On funds, the Government will consult on UCITS IV implementation and work to make the UK a more competitive environment by introducing a tax transparent contractual fund and looking at taxation of investment trust companies and other funds.