LONDON, Nov 11 (Reuters) - Fines paid by banks for rigginginterest rates will be used to finance a tax break for Britishmilitary charities raising funds from a First World War memorialthat has brought millions of visitors to the Tower of London.
The Treasury has said it will waive the value added tax(VAT) on the sale of hundreds of thousands of bright red ceramicpoppies that form a hugely popular installation marking thecentenary of the outbreak of the Great War.
The government will donate the amount it would have receivedin VAT -- 1.1 million pounds ($1.7 million) -- to six militarycharities.
It said some of the money it has collected in fines imposedby British authorities on seven banks and brokers accused ofrigging the benchmark Libor interest rate will be used for thedonation.
That comes on top of the proceeds from every poppy soldalready set to be shared among the charities, which includeCombat Stress and the Royal British Legion.
The government certainly has the funds to make the VATgesture. Banks including Royal Bank of Scotland,Barclays and Switzerland's UBS have paid 460million pounds ($730 million) to British financial regulators tosettle allegations of interest rate rigging.
Part of an art installation called "The Tower of LondonRemembers: Blood Swept Lands and Seas of Red", the ceramicpoppies each represent one of the 888,246 British and colonialsoldiers killed during World War One. It was created by ceramicartist Paul Cummins and staged by designer Tom Piper.
The first poppy was planted in July and more have graduallybeen added to fill the moat of the London landmark. It isestimated that around 4 million people will have visited theexhibition by the time the last is planted on Tuesday, theanniversary of the end of the conflict.
A campaign to extend the tribute succeeded in keeping partof the exhibition in place until the end of November.
Later, two of its features, Weeping Window and Wave -- acascade of poppies pouring out of a Tower of London window and acurling swathe of poppies at the entrance to the Tower -- willgo on tour around Britain.
(Reporting by Clare Hutchison; Editing by Giles Elgood)