Brief
City leaders urge Chancellor Healey to drop bank tax hike
Chief executives of UK Finance and the CBI say a higher bank levy would weaken investor confidence and could drive capital abroad.
By Felo News Desk · Published
Chief executives of UK Finance and the Confederation of British Industry (CBI) have signed a letter to Chancellor John Healey urging him not to raise bank taxes in the upcoming autumn Budget, warning that such a move could push businesses out of the United Kingdom.
What happened
The letter, addressed to Healey, was sent in early October 2026 as speculation grew that the chancellor might increase the bank corporate tax surcharge and the existing bank levy. The signatories, including David Postings of UK Finance and Rain Newton‑Smith of the CBI, argue that the financial‑services sector already bears a higher tax burden than rivals in other major economies.
What the reports add
Both Standard and Independent report that the letter cites the 3% corporate tax surcharge on bank profits and the separate bank levy on certain equities and liabilities. The letter contends that raising the overall tax burden could weaken investor confidence, damage the UK's attractiveness, and may not generate additional revenue if capital, people and businesses relocate.
What was said
According to the letter, the financial‑services industry “already faces a higher tax burden than our key international competitors”. The document adds, “As well as weakening investor confidence and damaging UK attractiveness, a higher tax burden may not necessarily generate higher tax receipts if capital, people and businesses move elsewhere.”
How it came about
The lobbying follows a series of tax‑policy warnings from opposition figures, including Shadow Chancellor Andrew Griffith’s September 17 warning that tax hikes were prompting high‑earning taxpayers to leave the UK (Felo). Industry groups have stepped up pressure in recent weeks as the Budget deadline approaches.
Key facts
- UK Finance and CBI chief executives signed a letter to Chancellor John Healey urging no increase in bank taxes. (standard.co.uk)
- The letter cites a 3% corporate tax surcharge on bank profits and a separate bank levy. (standard.co.uk)
- Signatories argue higher taxes could weaken investor confidence and drive capital abroad. (independent.co.uk)
Sources
- [1] standard.co.uk
- [2] independent.co.uk
