Cabinet revolt erupts over Healey's plan to raid banks ahead of October Budget

From the Newshound archive · first published 5 October 2026.

Senior ministers are openly warning Chancellor John Healey that hiking taxes on banks will wreck Andy Burnham's growth promises, with one Cabinet figure saying it is unwise to tax 'everything at once' when businesses are already reeling from higher business rates and National Insurance. Healey's fiscal headroom has reportedly halved to around £12 billion as the Iran war and soaring borrowing costs pile pressure on his 28 October Budget. Jamie Dimon, chief executive of JP Morgan, has also entered the fray, cautioning that a surcharge increase could push investment away from the UK.

Bosses of Lloyds, Barclays, HSBC and NatWest are expected to meet Healey on Tuesday to intensify their opposition to any higher levies.

Trade union leaders are pushing the Chancellor in the opposite direction, demanding a bank tax raid to finance lower energy bills for consumers this winter.

Jeremy Hunt warned publicly that raising bank taxes would ultimately hurt ordinary people, not just City boardrooms.