The storm had already claimed the lives of at least two people in China's Hainan and 16 people in the Philippines
Britain has introduced the tax saying banks should make “a fair contribution” to the potential risks they pose to the financial system and to encourage them to move to less risky funding. The amount to be raised is in line with a forecast made when the levy was announced in the budget in June.
The government has now published draft legislation on a levy which will be phased in from the start of next year.
“It will apply to the global balance sheets of UK banks, and the UK operations of banks from other countries,” Treasury minister Mark Hoban said in a statement.
Changes to the details have been made during a consultation period, but the British Bankers’ Association said the levy “will have a significant impact” on overseas banks.
It said more clarity is needed on how it will interact with taxation in other countries. “Some banks could be taxed multiple times by multiple jurisdictions on the same activities,” the BBA said.
Reuters Breakingviews reported earlier this week that HSBC, Standard Chartered and Deutsche Bank DBKGn.DE could have potentially big bills significantly reduced after arguing for changes in how it is structured, citing people familiar with the situation.
The Treasury has said wholesale liabilities that mature in less than a year will be taxed at a rate of 0.07 percent and longer term liabilities incur a 0.035 percent rate, while Tier 1 capital and insured deposits are exempt.
It said on Thursday that other deposits will be subject to the half rate in the same way as longer maturity liabilities.
It said it will also take a principles based approach for the netting of derivatives and other assets and liabilities.
Hoban said: “We have consulted on the design of the scheme so that it achieves two objectives: firstly, ensuring that banks make a fair contribution in respect of the potential risks they pose to the UK financial system and wider economy.
“Secondly, the final scheme design incentivises banks to make greater use of more stable financial sources, such as long term debt and equity, working with the grain of our wider reform programme,” he added.
Unveiling 80 billion pounds of spending cuts on Wednesday, finance minister George Osborne ratcheted up the rhetoric on banks, pledging to seek the “maximum sustainable” revenue from the financial sector.
The British government said it would work with international partners to explore the merits of a Financial Activities Tax on profits and remuneration.
The storm had already claimed the lives of at least two people in China's Hainan and 16 people in the Philippines
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