The Chancellor, John Healey, is planning to raise taxes on banks in his Budget on 28 October, Bloomberg reports, citing unnamed people familiar with the plans. This is a briefing, not an announcement.
Bloomberg says a bank tax rise is among the major measures Healey has submitted to the OBR, to fund cost-of-living support and stabilise the public finances. It says the move will likely involve raising the bank surcharge, which is levied on top of standard corporation tax. No rate or expected yield has been reported.
City AM reports that the surcharge is currently 3%, having been cut from 8% under Jeremy Hunt in 2023. The Guardian reported that reversing that cut is an option Healey is considering, according to Reuters, but it did not say a final decision had been made.
Bank shares fell at the open on Friday 16 October. City AM reports NatWest fell 2% to 660.40p, Lloyds about 2.5% to 103.40p and Barclays 0.4% to 430.50p.
Speaking to reporters at the IMF meetings on 15 October, Healey said: "I will meet those fiscal rules". Reuters reports he called banks key to the economy but kept tax options open.
Kemi Badenoch, the Conservative leader, and Jeremy Hunt, the former Chancellor, have both warned against a bank tax, City AM reports. The campaign group Positive Money claims a windfall tax could raise £19bn from NatWest, Lloyds, Barclays and HSBC alone. That is not a government or OBR figure and has not been independently checked.