Calls for a tax increase on the banking sector are intensifying under the new government led by Prime Minister Andy Burnham and Chancellor John Healey, following strong first-half profits reported by banks.
Previously, under Rachel Reeves, the sector avoided significant tax increases in two Budgets. However, the current administration is perceived to be taking a different approach.
Activists from Positive Money have proposed a windfall tax, estimating it could generate £19bn from the UK's four largest banks alone. They cited the £13.7bn paid to shareholders by these banks as evidence of their capacity for higher taxes. Dianne Abbott, Mother of the House of Commons, also called for increased bank taxes after Barclays deepened its bonus pool.
Banking executives, including those from Lloyds and Natwest, have declined to comment directly on potential tax changes, stating it is a government decision. Some bank bosses have highlighted their operations across the UK and regional investments, with Natwest announcing £20bn in lending for the north.
The potential for new bank taxes is expected to be clarified when Chancellor John Healey delivers his first Budget on 28 October.