John Healey plans to tax British banks in the upcoming budget, aiming to reclaim some of the £29bn profit made by the four biggest banks in the first half of this year. The sector's windfalls are linked to higher interest rates, not improved services.
01Summary
- 01Britain’s four biggest banks made £29bn in the first half of this year, up a fifth on 2025, according to Positive Money.
- 02The chancellor is considering restoring the bank surcharge from 3% to 8%, which could raise around £2bn a year.
- 03Over the past five years, Barclays, HSBC, Lloyds and NatWest made profits of £200bn.
- 04Households lost out on £44bn in deposit interest in 2025, five times the average for 2009-21, says Positive Money.
- 05A 2.5% levy on interest-free deposits could raise over £11bn, and a windfall tax similar to that on fossil fuels could bring in £19bn from the big four banks.
02Why it matters
This matters because banks are paying the highest bonuses since the 2008 crisis while households and businesses face higher borrowing costs. A fairer tax could fund public services like adult social care and reduce the risk of future financial crises.
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