Key facts
- JP Morgan CEO Jamie Dimon warned against penalizing banks with new taxes.
- Dimon stated that uncompetitive tax systems cause capital to leave a country.
- He refused to commit to JP Morgan's planned £10bn London tower project.
- The UK government must decide on a tax break for the tower.
- The decision will signal the government's approach to international investment.
Jamie Dimon, the chief executive of JP Morgan, has issued a stark warning to the UK government, urging it against imposing new taxes on the banking sector. Dimon stated that a competitive and consistent tax system is essential for capital formation and economic growth, and that penalizing companies can lead to capital flight. His comments come as the new UK government faces a critical decision regarding a tax break for JP Morgan's planned £10 billion tower in Canary Wharf. The bank's CEO refused to commit to the project's future if bank levies are increased, emphasizing that governments often err in their policy decisions. A previous Memorandum of Understanding with the bank indicated an exemption from business rates for the tower, but this non-legally binding document requires a decision to be made on whether to proceed to a legally binding agreement. This decision will serve as an early indicator of the government's commitment to fostering international investment. Banks currently face a 28% corporation tax rate, including a 3% surcharge, a levy introduced after the financial crisis, which Dimon believes was wrongly applied to JP Morgan. He expressed a desire for the UK to thrive and for the government to implement policies that drive growth.