Healey leaves bank tax decision open until October budget

UK Chancellor John Healey said he would set out decisions on bank taxation in the October 28 budget, without indicating whether rates would rise. His remarks came as reports said an increase to the bank surcharge was under consideration, but no final policy has been announced. Speaking to reporters in Bangkok on October 15, Healey described banks as central to the country’s economic future and said they were part of the UK’s economic fabric. He added that he had decisions to take in the budget. Healey said his comments were not intended to signal what tax changes he might make and declined to discuss budget speculation. The surcharge, which banks pay on profits in addition to corporation tax, is currently 3%. It was reduced from 8% in 2023. Reversing that cut is one option reported to be under discussion. Estimates cited in the reporting suggest a return to 8% could raise about £2 billion a year; a more precise estimate attributed to Trades Union Congress analysis was £2.25 billion annually. UK Finance has warned that higher bank taxes could weaken the country’s competitiveness, discourage investment and job creation, and run counter to the government’s growth ambitions. In a...