Finance (No.2) Bill

The new clause relates to the taxation of the banking and financial services industry, and proposes that the Treasury publish a report before the 2011 Budget examining the level of taxation on those sectors. Before I discuss the new clause directly, I think it would be helpful to set out some of the background and context relating to the Government's approach to taxation of the banking sector. The Chancellor set out clearly in the recent spending review the Government's objective in taxing the banking industry. We inherited the largest peacetime deficit in UK history, and, during these difficult times it is only right that steps are taken to ensure that the banks pay a full and fair contribution. I listened with interest to Opposition Members, who appear to have a very blinkered perspective of regulatory issues. They skimmed over their own Government's part in the regulatory failures that led to the banking sector crisis. It is worth going back to some comments made by the previous Prime Minister, the right hon. Member for Kirkcaldy and Cowdenbeath (Mr Brown). I know he is now making speeches in the House again, but it might have been helpful if he had participated in this debate, given his own involvement in these matters. When opening Lehman Brothers' new European headquarters in 2004, he said:"““I would like to pay tribute to the contribution you and your company make to the prosperity of Britain””." He also said that Lehman Brothers"““has always been an innovator, financing new ideas and inventions before many others even began to realise their potential.””" The last Government clearly had a huge role to play in that the regulatory system they brought in during their term in power absolutely failed the British public.