Osborne Warned: Make Banks Pay Their Fair Share of Tax

george osborne

The chairman of an influential committee of British lawmakers has asked finance minister George Osborne to make clear that banks should not be able to offset regulatory fines against their corporation tax bills.

In a letter sent to the Treasury, Conservative lawmaker Andrew Tyrie said it was important lenders were paying the full cost of misconduct penalties.

“It would be wholly unacceptable if taxpayers, having bailed out the banks in 2008, were to find themselves partly responsible for paying the banks’ fines,” Tyrie said in the letter, published on Sunday.

British banks have been fined billions of pounds by global regulators since the 2007-09 financial crisis for a slew of mis-selling scandals, alleged market manipulation and regulatory breaches.

Tyrie, who chairs Britain’s Treasury Select Committee, also requested clarification from Osborne that settlements reached with foreign regulators should also prohibit UK tax deductability.

He said, however, that costs for banks related to independent reviews ordered by Britain’s Financial Conduct Authority to determine whether or not misconduct took place should be tax deductable, so long as no wrongdoing was found.