Healey faces calls for cautious Budget and bank tax rise

UK Chancellor John Healey is expected to deliver a cautious first Budget on October 28, balancing cost-of-living measures and support for businesses against pressure to maintain fiscal discipline. A higher tax on banks is widely anticipated in pre-Budget reporting, but no rate or final design has been confirmed. Healey has said his priorities include helping households and businesses while controlling public finances. The government faces higher borrowing costs and limited room for new spending, while retaining fiscal rules requiring day-to-day spending to be funded by taxes by 2029-30 and public debt as a share of the economy to fall in the same year. The Office for Budget Responsibility forecast about £24 billion of fiscal headroom in March. The Resolution Foundation estimates that the remaining buffer may have fallen to £12 billion, while the Institute for Fiscal Studies puts it at about £20 billion. Those estimates reflect different assessments of the available fiscal room, rather than a settled figure ahead of the Budget. A possible increase to the bank surcharge or levy has become a focus because other tax rises have been ruled out or constrained. One proposal under...