UK bank bosses and John Healey set for tax showdown
When banking lobbyists geared up for an offensive ahead of the 2025 Budget, a tax cut barely made the wishlist. Modest in their ambitions, advocates were preparing to settle for anything that didn’t see their already eye-wateringly high tax bill rise. That is until, City AM understands, officials advised them to make a cut a [...]
The UK banking sector is set for a potential tax showdown as John Healey, the new Chancellor, prepares to deliver his first Budget. The City, represented by banking lobbyists and CityAM, had initially aimed to secure a modest tax cut, but officials advised prioritizing a top-tier increase to counterbalance calls for a hike in the banking surcharge.
Under the previous Chancellor, Rachel Reeves, the surcharge remained unchanged, but Healey's tenure promises a different dynamic. Healey's office has cautioned banks against expecting a similar relationship with him as they had with Reeves, suggesting fewer face-to-face interactions in London. The potential tax increase has raised concerns among British banks, who already face a high tax burden, accounting for 46% of their profits compared to 29% in Dublin.
Some in the industry fear the Chancellor may even introduce a windfall tax on banks, which activists estimate could raise £19bn for the government. However, some in the sector have expressed hope for a more favorable outcome, with a push for higher thresholds for the surcharge and a potential reward for mid-sized banks that champion small business lending.
Written by urgent.news from City AM's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
