Savers need tax breaks, says Barclays Boss
Tax-effective deposit accounts will encourage saving
Chief executive of Barclays Bank John Varley has called on the government to
introduce measures to entice customers to keep their money in bank deposit
accounts.
Thanks to falling interest rates, banks are struggling to offer customers
decent returns on their savings, Varley told Channel Four News.
“The ability of banks to create the sort of savings returns that customers
had two or three years ago is quite constrained,” he said.
Interest rates, already at historic lows after the Bank of England last week
slashed the cash rate to 1.5 per cent, are poised to fall even further.
This means that depositors could face 0% or even negative interest rates on
their savings. And, under current tax rules, tax deductions do not apply if
negative interest is charged.