- Rishi Khosla says banks would be left with less to lend to start-up firms
The chief executive of one of Britain’s major business lenders has warned Rachel Reeves that a tax on banks would damage the UK’s economic growth engine.
Rishi Khosla, head of OakNorth, which provides loans to small firms often shunned by big banks, told The Mail on Sunday that a new levy on bank profits would leave them with ‘less capital to lend’ to growing firms.
‘The UK already has one of the highest effective tax rates for banks in the developed world.
‘If investors in British banks see continually lower returns here than elsewhere, they’ll simply deploy their capital in other markets, leaving even less money to fund UK businesses and growth,’ Khosla said.
‘Less capital to spend’: Rachel Reeves has been warned that a tax on banks would damage the UK’s economic growth engine
Banks were expected to be spared a new levy after Reeves indicated she wanted to protect the sector. But they were back in her sights last week with reports that Reeves was mulling a last-minute raid on their profits.
Khosla also said the recent exodus of entrepreneurs should be a ‘wake-up call’ for Reeves not to impose more taxes, adding: ‘We need to be doing everything we can to keep and attract them, not push them away.’
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