Story perspectives

UK Treasury Weighs Bank Tax Hike Amid Deficit Crisis

10/6/2025

27 2

Center

Reeves Considers Bank Tax

The UK Treasury is contemplating a tax increase on bank profits to tackle a multi-billion-pound deficit before the November Budget.
Chancellor Rachel Reeves is under pressure to raise the bank surcharge or implement a new levy to generate at least £2 billion.
The current bank surcharge stands at 3%, down from 8% in April 2023, with calls for its reinstatement.
The IPPR think-tank proposes an alternative tax method to recover losses from the Bank of England’s asset transactions.
UK Finance cautions that higher taxes may hinder economic growth and prompt banks to relocate.

Left

Reeves Justifies Tax Hikes

Chancellor Rachel Reeves faces pressure to justify potential tax increases in her upcoming budget.
Labour's tax-reform narrative remains unclear, risking backlash like last year's winter fuel cut.
Polls show support for progressive changes, including taxing rental income and reforming capital gains.
The Institute for Fiscal Studies urges a cohesive tax-reform vision, not isolated increases.

1 of 2

Reeves Considers Bank Tax

The UK Treasury is contemplating a tax increase on bank profits to tackle a multi-billion-pound deficit before the November Budget.
Chancellor Rachel Reeves is under pressure to raise the bank surcharge or implement a new levy to generate at least £2 billion.
The current bank surcharge stands at 3%, down from 8% in April 2023, with calls for its reinstatement.
The IPPR think-tank proposes an alternative tax method to recover losses from the Bank of England’s asset transactions.
UK Finance cautions that higher taxes may hinder economic growth and prompt banks to relocate.

1 / 2