Britain’s banks will pay an extra £4bn in taxes during the next five years due to changes announced by Chancellor of the Exchequer George Osborne in his autumn statement.
Osborne said he would change rules which enable banks to offset losses from the financial crisis of 2007 to 2009 against tax on profits for years to come.
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The government will limit the tax relief banks can claim from past losses to 50% from April next year.
"The banks got public support in the crisis and they should now support the public in the recovery," Osborne said.
"Banks can offset all of their losses from the financial crisis against tax from profits for years to come. Some banks wouldn’t pay for 15 to 20 years. That is totally unacceptable," he added.
Lloyds Banking Group, which has £5bn of UK net deferred tax assets, and Royal Bank of Scotland, which has £2.1bn are among the banks expected to be hit hardest by the policy, according to Financial Times analysis. Barclays has £500m of UK deferred tax assets.
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