Tuesday, February 08, 2011
Osborne squeezes another 800m out of the banks
Posted by David Smith at 11:00 AM
Category: Thoughts and responses

Is it economics or politics? George Osborne has announced that he is raising the amount of this year's banking levy from 1.7 billion to 2.5 billion. The banks will be charged more from March 1 (a 0.1% levy), compared with 0.05% for both January and February, before the rate reverts to 0.075% in April.

The official explanation is that the banks are stronger and able to take it, and that the announcement could not be delayed until the budget. Part of it, however, must reflect Labour criticism that the coalition is letting the banks off too lightly. The Treasury announcement is here.

PS: For those who are interested, I am now tweeting on @dsmitheconomics. You can read the tweets on the left-hand side of the page, or on twitter.com.