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Wednesday 27th of January 2010
January 20, 2010    

HSBC chief warns of super tax

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by Kay Murchie

In an interview with Sky News, HSBC chief executive Michael Geoghegan has warned of the dangers of the new super tax, introduced by the Government to claw back some of the bailout funds used to rescue the banking industry.

The warning comes just a week after London Mayor, Boris Johnson, warned that high-earning bankers are leaving the capital because of the super tax.

In the recent Pre-Budget Report (PBR), UK Chancellor Alistair Darling confirmed there would be a one-off 50% tax on bankers’ bonuses paid above £25,000.

As a result, Mr Johnson wrote to the Chancellor requesting an urgent meeting to discuss how to reverse “the damage done to perceptions of London as a global financial centre” by the introduction of the super tax.

However, now Mr Geoghegan has expressed his concerns about what impact the super tax will have on London.

He told Sky News: “In a way I think the UK is moving too fast over regulation change and places like New York, Paris and the rest of the world are staying behind while the UK is penalised.”

Mr Geoghegan added that a number of bankers are moving out of the UK as a result of the tax.

According to Boris Johnson, approximately 9,000 bankers could flee the capital because of the tax and said his “ aim is to maintain London’s reputation as the number one business destination, and I am looking to Government to help, not hinder, that goal.”

At the time of the PBR, Barclays chief John Varley said that London may be “damaged” by the new bonus tax.

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