United Kingdom: London announces post-Brexit fiscal reforms

On Friday, the British government will announce post-Brexit reforms aimed at spurring robust financial sector growth, in particular to reverse some of the measures put in place in the aftermath of the 2008 crisis.

UK Finance Minister Jeremy Hunt announced in Edinburgh “a set of 30 regulatory reforms to secure the UK’s position as the world’s leading financial centre,” according to a statement from Britain’s Treasury.

Laws ensuring the separation of retail and investment activities within a bank, a legacy of the 2008 financial crisis and aimed at avoiding conflicts of interest (“dueling” in English) and protecting consumer funds, will be updated to extract from them the restrictions of “banks that do not have investment activity”. Big,” the press release reads.

The regulators, FCA for markets and PRA for banks, “will be given the goal of generating growth and will undertake a comprehensive review to delete hundreds of pages of EU legislation”.

The Treasury says the Edinburgh reforms will give unparalleled strength to UK financial services, taking advantage of the opportunities offered by Brexit to “generate” a regulatory framework tailored to the country’s needs.

In particular, the rules that “stifling growth, with very restrictive EU laws discouraging companies from listing in the UK, would be reformed to be reformed (…) within the Financial Services and Markets Bill”.

The British government had already launched a part of the reform relating to insurers a few months earlier, hitherto governed by the European Solvency II directive.

London in particular plans to ease capital requirements for companies in the sector, hoping to unlock tens of billions of pounds for “green” investment and infrastructure.

See also  11 of the best movies to watch in May

Jeremy Hunt, who presented the fiscal measures last month, acknowledged that the country was already in recession and that the Bank of England’s forecasts were for deflation for the whole of next year.

The financial sector generates £216 billion (€250 billion) annually and £76 billion (€88.1 billion) in tax revenue for the state, while employing more than 2.3 million people according to the Treasury.

Leave a Reply

Your email address will not be published.