Campaigners are renewing calls for a windfall tax on UK banks, which they estimate could raise £19bn towards Andy Burnham’s cost of living agenda. This follows HSBC reporting profits of £7.5bn ($10.1bn) in the second quarter of the year.
HSBC bosses stated on Tuesday that profits increased by 60% year-on-year in the three months ending June. This rise was attributed to fees from wealth management and insurance, alongside higher interest rates, which enable the bank to charge more for loans and mortgages.
The collective profits for the four largest banks – HSBC, NatWest, Barclays, and Lloyds – reached £29.2bn over the first six months of 2026. Groups including Positive Money and the Trades Union Congress (TUC) are advocating for a new tax on the banking sector.
Positive Money suggests that bank bosses have committed nearly half of their profits, £13.7bn, to shareholders through dividends and share buy-backs. They argue this demonstrates the industry's capacity to absorb a tax that could generate £19bn for government spending plans at the October budget. Positive Money proposed replicating Spain's levy, targeting UK revenues above £800m with a 38% tax.
HSBC chief executive Georges Elhedery indicated he would consider increasing banker bonuses and plans to restart a share buy-back programme. Banking bosses have expressed caution regarding a new tax, emphasising that strong banks are crucial for UK growth.