The UK's challenger banks will still face a sharp rise in their tax bills after the Competition and Markets Authority (CMA) concluded, following an investigation, that a one-size-fits-all approach to taxing the sector is not anti-competitive. The CMA investigated the retail banking market and found "no strong evidence" that a corporation tax surcharge (CTS) on all banks making a profit of over £25m would deter new entrants, stifle their growth or push small lenders out of business, adding that the "six largest retail banks will continue to pay higher effective rates of tax than smaller banks". However, it said there was "limited evidence for any impact from such a surcharge".
The UK's challenger banks will still face a sharp rise in their tax bills after the Competition and Markets Authority (CMA) concluded, following an investigation, that a one-size-fits-all approach to taxing the sector is not anti-competitive. The CMA investigated the retail banking market and found "no strong evidence" that a corporation tax surcharge (CTS) on all banks making a profit of over £25m would deter new entrants, stifle their growth or push small lenders out of business, adding that the "six largest retail banks will continue to pay higher effective rates of tax than smaller banks". The challenger banks had argued that the new system hit them disproportionately.