The banking sector responded with anger to the comments of Lord Turner, chairman of UK’s financial sector regulator – FSA, who supported levying additional taxes on financial transactions and described banks as ‘socially useless’ – reported Guardian.co.uk.
Earlier, it has been reported that FSA was contemplating to use a tax called ‘Tobin tax’ on financial transactions globally, as an addtional tool to curb excessive activity and profits in the sector.
Even though some private bankers have agreed that investment banks have gotten out of hand, they did not supported a transaction tax. Instead, they suggested that other industries should be encouraged to develop and re-balance the economy.
Angela Knight, chief executive of the British Bankers’ Association, said: I think that if we say we do not want to have an international, competitive, industry here, then we will do to financial services what we have done to manufacturing and engineering in the past and that is have it as a minor industry and lose it to others.
However, the Treasury chose to distance itself from the issue and said: Taxation is a matter for the chancellor, and G20 finance ministers will be discussing bonuses that put the banking system at risk, in London next week, reported the newspaper.
