The Isle of Man and Jersey's decision to drop corporation tax, has prompted Guernsey to consider following suit.

But Deputy Treasury Minister Charles Parkinson says many banks have already moved off the island.

And he wants to finance firms to pay 20% tax to cut the impact on islanders who would be forced to balance a budget shortfall through higher taxes.

He believes that a 20% tax rate would more than halve the potential black hole from �45m to �20m.