Levene's tax onslaught won't bend Gordon's ear

Lord Levene may be entering his final dawn as Lloyd's chairman, given he cannot serve beyond his six-year term, but he remains as bullish as ever about pushing for a further cut in corporation tax.

A 2% drop, from 30% to 28% in last month's Budget, appears to have done little to appease Levene, who used the opening of the Lloyd's Shanghai office last week as an opportunity to demand further cuts.

He insists Lloyd's expansion into China and work to create a paperless market is a clear indication of the market's move towards modernisation.

As a result, he says the Treasury should keep its end of the bargain and at least consider the argument for a more level playing field with the likes of Bermuda, which has no corporation tax.

Levene moves in esteemed circles, so if anyone can lean on Gordon Brown to reconsider the UK's tax regime then it should probably be him.

He has exclusive access to Brown's high level group, set up to look at the City of London's international competitiveness, and he will no doubt use next month's meeting as a sounding board to argue Lloyd's case once again.

The group has been anonymous since its inaugural meeting was adjourned in October last year.

Work has been going on behind the scenes with sub financial service groups meeting competition commissioner Neelie Kroe to discuss principles-based regulation with the FSA, and European regulation s.

But City grandees, including Levene, will be rolled out on 9 May to give the issue of competitiveness some additional clout and Brown can expect to hear more on how a further reduction in tax will go some way to maintaining the UK's competitive edge.

While the recent tax snip was a welcomed boost to the industry, some tax experts are unconvinced that the Treasury will give way to further pressure and cut tax to 20%, which is the magic number.

Stephen Catlin recently said thatanything in the 20% region or below would make him reconsider redomiciling back to the UK, but he is unlikely to need his suitcase any time soon.

Levene may know the right people and have connections in high places, but unless he can magically come up with a way of making up for billions in lost tax revenue, not even a change in personnel at No 11 will deliver what he and his allies want.

Perhaps Levene would be better served addressing Lloyd's own costs of operating in the market, as a way of stemming the loss of insurers to Bermuda. IT