The U.K. has announced plans to cut corporation tax, and will phase out a bank levy in a bid to persuade global players such as HSBC to stay in London.

Britain already has one of the lowest official rates of corporate tax (20%) among major developed economies. The cut unveiled Wednesday will be partially offset by the cost to business of increases in the national minimum wage.

Finance minister George Osborne announced the changes in his first budget speech since the general election in May.

Analysts say the decision to phase out the bank levy is designed to convince HSBC (HSBC) and Standard Chartered (SCBFF) that they should remain in the U.K. The levy was introduced in 2011 to force the big players to help pay for the fallout of the financial crisis.

HSBC is conducting a review, to be completed by the end of 2015, on whether it should relocate out of London. The bank's previous home, Hong Kong, is the most logical alternative.

Here are the details of the main tax changes:

• Corporate tax rate cut to 19% in 2017, and 18% in 2020. The rate was as high as 28% in 2010.
• The levy on big banks' balance sheets will be reduced from 0.21% to 0.1% between 2016 and 2021. Overseas subsidiaries will be excluded from the levy from 2021 too.

Whether that will be enough to convince HSBC and others to stay is unclear.

The British Banking Association welcomed the changes to the levy, but criticized plans for a new 8% tax on banking sector profits, and said it could hurt smaller banks in particular.

"It is better to charge tax on profits rather than on balance sheet size and the changes should support UK banking activities," said Bill Dodwell, head of tax policy at Deloitte.