Santander executive chair Ana Botín has criticised the UK’s tax treatment of banks, arguing that the current system “makes no economic sense”.
Speaking to the Financial Times, Botín said that if the government wanted to encourage economic growth, “taxing banks more heavily than other companies makes no economic sense”.
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Under measures brought in after the 2008 financial crisis, banks operating in the UK face a levy on their balance sheets as well as a surcharge on profits, on top of standard corporation tax.
Botín said: “The question is, why single out the banks in particular and impose additional taxes? We already pay a corporate tax rate of around 30%, our profit margins are nowhere near those of monopolistic players, and we’re not reaping windfall profits.
“If policymakers are looking for sectors earning outsized returns, there are other places to start.”
She also said business lending by banks “drives investment and job creation”.
Banks avoided further tax increases in the Budget last November, after Chancellor Rachel Reeves sought assurances that lenders would expand lending in the UK and publicly back her fiscal approach.
The sector has come under greater scrutiny in recent years as higher interest rates lifted bank earnings, prompting calls for extra taxes in a number of European markets.
Botín’s remarks add to criticism already voiced by other senior banking figures over the UK regime.
Last month, JPMorgan Chase chief executive Jamie Dimon said he would drop plans to invest £3bn ($4bn) in a new London headquarters if taxes on banks were raised again.
Barclays chief executive CS Venkatakrishnan has also cautioned ministers against imposing higher taxes on lenders.
Santander has been part of the UK retail banking market for more than 20 years. The Spanish bank, which is the largest listed lender in continental Europe by market value, last month completed its £2.65bn acquisition of TSB.
The transaction increased Santander’s UK customer base to roughly 19 million.
