The boss of Goldman Sachs has urged Rachel Reeves not to add to the financial burden on the banking sector, amid fears it could be the target of big tax rises in next month’s Budget.
Sky News has learned that David Solomon made the warning during a private meeting with the chancellor last week, when he reportedly told her that imposing higher taxes on banks would harm Britain’s wider economic growth prospects.
The meeting took place seven weeks before a crucial budget for the Work government, which is struggling to find ways to plug a budget hole estimated at between £20 billion and £30 billion.
Goldman Sachs revealed in its latest annual earnings report that it paid more than $529 million in U.K. corporate tax last year.
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It reported nearly $4.3 billion in profits on revenue of $10.7 billion in the UK in 2024.
The Wall Street giant employs around 3,500 people in Britain.
Due to its size, Goldman is required to pay the UK Bank Levy, which is effectively a tax on its UK balance sheet and liabilities.
It also pays a 3% corporation tax surcharge levied on all banks with profits above £100m.
The surcharge was introduced in 2016 at a rate of 8%, before being reduced to 3% seven years later.
Major British and international banks have lobbied in recent weeks against the reversal of the cut.
The banking sector risks being hit with additional taxes next month, both because of the scale of the fiscal challenge it faces Ms. Reeves and the fact that the sector is generating some of its biggest profits since the 2008 financial crisis.
Mr Solomon’s plea to the Chancellor last week is not the first time this year he has raised the implications of the UK’s rising tax burden.
In an interview with Wilfred Frost, Sky News presenter Earlier this year he said London’s status as one of the world’s leading financial centers was “fragile”.
“London continues to be an important financial center, but because of Brexit and the way the world is changing, talent that was more concentrated here is more mobile,” he said in July.
“As a company, we have many more employees on the continent.
“Politics matters, incentives matter. »
Mr Solomon added that he had been “encouraged by some of what the current government has said in terms of supporting business and trying to support a more growth-oriented agenda”.
“But if you don’t establish a policy that keeps talent here, that encourages capital formation here, I think over time you risk that.”
The Treasury did not provide an official account of last week’s discussion between Ms Reeves and Mr Solomon, but said of a separate meeting she had with Jamie Dimon, chairman and chief executive of JP Morgan, who had previously welcomed reforms to the UK’s financial services sector.
Spokespeople for Goldman Sachs and the Treasury declined to comment.