Ill-defined bank tax a dangerous plan

Mark Littlewood comments on Shadow Chancellor Alan Johnson's speech

In commenting on the Shadow Chancellor’s speech today, Mark Littlewood, Director General at the Institute of Economic Affairs, expresses concern over the false economic arguments being put forward. He said:

“The Shadow Chancellor is wrong to advocate an ill-defined £7.5bn tax on banks. That would weaken the financial services sector by encouraging an acceleration of relocations to other countries. Bankers, stockbrokers and hedge fund managers will continue to leave London if the tax burden becomes uncompetitive.

“The Coalition is right to be seeking to reduce the deficit rapidly. But it could move yet faster by committing to a proper strategy for economic growth. The private sector’s ability to generate new jobs is compromised by the obscenely high regulatory burdens faced by companies operating in Britain. The trend in employment legislation has been towards making it more and more expensive to recruit and retain staff. A bonfire of red tape is needed to free up the labour market and build on the fragile economic recovery.”

To arrange an interview with Mark Littlewood, IEA Director General, please contact Ruth Porter, Communications Manager, 077 5171 7781, 020 7799 8900, rporter@iea.org.uk .