Jamie Dimon has a message for the UK: go easy on the banks.
Jamie Dimon runs JPMorgan Chase, and he is not the type to keep his opinion to himself. The report is based on people who were briefed on the conversation, so there is no public record of the call. But Dimon's view has been clear for a while.
He makes it clear: capital, the money that flows through the world's markets, has legs. When a country makes itself too expensive, some of that money will simply leave.
Dimon made the same point with New York as an example, saying finance employment has dropped there and the city's tax burden deserves some of the blame. His bigger argument is simple: tax banks too heavily and your country ends up losing the jobs and the business that come with them.
That is a familiar tune for Dimon. He has repeatedly complained about the UK's bank tax surcharge, which is an extra tax that banks pay on top of the normal company tax. His warning is that raising that surcharge could push money out of the country before the government ever sees the extra tax money it wanted.
The call did not happen in a quiet moment. That leaves the door open.
Right now banks are showing nice profits, and profits like that draw attention. Labor unions and other worker organizations are calling for lenders to pay more. A healthy and successful industry makes a tempting target when the government has a need for cash.
The final budget will be the real test of Dimon's influence. Raising the surcharge and raising other taxes seem like an easy way to show action. But Dimon's phone call was a warning that actions have effects.
The trouble for the government: banks are the unlucky kind of business that can move. Unlike a factory, a bank can shift operations to another country with a smaller tax bill. That would be on top of the ordinary cost of any tax hike.
What happens in this either matters because bank taxes do not stay underwater. When a bank gets hit with higher taxes, it can pass some of that cost down to customers. It may also offer less to shareholders, which matters if you own shares in British banks.
There is also a deeper part of this that is easy to miss. The word "capital" is not just a regular finance term. It is real money that flows into buildings, investments, and loans.
If a lot of that money leaves, it's not just one part of a budget. It can change private lending of money and slow the whole economy down.
The choice now lies with the government. Dimon has made his case in a single sentence: "If you have a uncompetitive tax system, capital leaves your country." A bad question? It's a line that may not be in the budget.
The no business for regular people, it's a sign to pay attention. When politicians and bankers start pulling in opposite directions, your money can feel the pull. With the October budget still coming, that tension is worth watching.
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