The Financial Times reports that Jonathan Kelling, the CEO of stockbroker Arden Partners has sent a letter to the UK Treasury drafted by the firm and seven rivals (Altrium Capital, Cenkos Securities, Collins Stewart, Evolution Securities, Numis Securities, Oriel Securities and Panmure Gordon) on the subject of the bank bonus tax.
The brokers point out that the bonus legislation appears to capture their firms, yet they don't take in deposits, didn't participate in the mortgage market, and wouldn't have been bailed out had they failed in any case.
Here's the letter:
Bank Payroll Tax
As CEO of a quoted stockbroker I am angry to find that the draft BPT legislation appears to capture our firm, and indeed our fellow competitors in the crossfire over the government bailout of the UK banks.
We are not a bank - we do not lend or take deposits, nor have we participated in the mortgage market. We therefore did not benefit from the risk taking that produced the credit crunch, as banks did. It would therefore be wrong to punish us as though we had, and would damage the responsible part of the City.
I am sure that the government's intention was not to capture all regulated firms in the UK, but this legislation has the potential to damage all. If it stays as drafted, it will be grossly unfair and have negative effects that the government cannot have considered.
We are but one of a number of similar firms who have run our businesses responsibly through what has been one of the most difficult markets conditions since the early seventies. If we had failed, the government would not have helped.
Good stewardship is the key to running a successful business and the proposals as drafted will have a detrimental effect on us and the City in general. The BPT has proved a distraction to staff throughout the City who have worked hard to ensure our survival through the recent difficult times.
The BPT has the potential to prompt more firms and talented individuals to leave the City. I am also concerned that there is a potential to give overseas firms a competitive advantage over UK owned and operated businesses.
Chief Executive Officer
Arden Partners plc'
Source - The Financial Times