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Report: Tyrie urges Osborne to clarify tax rules on bank fines

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Report: Tyrie urges Osborne to clarify tax rules on bank fines

U.K. Treasury Select Committee Chairman Andrew Tyrieurged Finance Minister George Osborne to clarify the country's tax rules toensure that banks will not be able to offset the cost of fines imposed byregulators against their tax bills, Reuters reported April 6.

In a letter, Tyrie asked Osborne to clarify whether finescategorized as "compensation" payments to regulators are taxdeductible.

U.K. tax rules were revised in 2015 to restrict the taxdeductibility of compensation payments made to customers. According to Tyrie,Osborne has suggested that the recent rule change may not have coveredcompensation payments to regulators, which could therefore still be deductedfrom tax.

Tyrie said it would be "unacceptable" if taxpayerswere to be partly responsible for paying the bank's fines, and urged Osborne toreview the matter. He added that regulators should ensure that any paymentsrelated to misconduct are either made to customers or labeled as fines ratheras compensatory payments, Reuters noted.