Britain's Labour plans increase in bank taxes to fund welfare

Reuters News
|
Posted: Sep 23, 2013 9:15 AM
Britain's Labour plans increase in bank taxes to fund welfare

LONDON (Reuters) - Britain's opposition Labour party said on Monday it would increase taxes on banks' balance sheets and introduce a levy on bankers' bonuses to pay for spending on childcare and job guarantees if it won the 2015 election.

Ed Balls, the man who could be finance minister if Labour wins the next election, said he would increase the existing tax on banks' balance sheets -- known as the bank levy -- to raise an extra 800 million pounds ($1.28 billion).

"We will use the money, for families where all parents are in work, to increase free childcare places for 3 and 4 years olds from 15 hours to 25 hours a week," Balls told the Labour party conference in the English seaside resort of Brighton.

Balls also said Labour would repeat a tax on bankers' bonuses to pay for job guarantees.

"We will fund this by a repeat of the tax on bank bonuses and by restricting pension tax relief for the very highest earners to the same rate as the average taxpayer," Balls said.

Labour introduced a bank bonus tax when it was last in power in 2009-2010, charging 50 percent on bonuses above 25,000 pounds. Balls gave no details about what levels he would tax bonuses.

(Reporting by William James; Editing by Guy Faulconbridge)