The Government has published draft legislation of its Finance Bill 2011 including details on the proposed banking levy and consultations on the powers of HM Revenue & Customs.
It is the first time the Government has published the majority of draft clauses for consultation.
The introduction of a permanent bank levy on banks’ balance sheets was announced in the Budget in June.
Following two consultation periods, the final legislation sees the rate of the levy increased from 0.04 per cent to 0.05 per cent.
The rate will also rise to 0.075 per cent from 2012, instead of the 0.07 per cent announced in June.
Banks will be given a £20bn allowance, rather than a threshold, for liabilities to which the levy applies.
The Treasury says these changes will generate around £2.5bn of annual revenues. The levy will take effect from January 1, 2011.
In addition to the details on the banking levy the Treasury has also published a raft of documents on other tax changes included in the draft Finance Bill.
These include the response to the consultation on pensions annuitisation, a response to the consultation on furnished holiday lets, and a response to the consultation on simplifying corporate capital gains tax.
The Treasury has also announced that two consultations will also be published today relating to a review of HMRC powers, though details have not yet been published.
Exchequer secretary to the Treasury David Gauke says: Today’s draft Finance Bill marks a substantial improvement in the way we create tax policy.
“Not only is this draft Finance Bill the shortest in recent years, it is also the most transparent. By giving people and businesses time to adjust to these tax changes, as well as inviting them to comment on the changes, we are making tax policy significantly more accountable.”