Politics · United Kingdom · 2 hrs ago
UK budget raises bank taxes to fund £100 energy payments for households
In his first budget, UK Chancellor John Healey announced a £100 energy payment for 20 million households this winter.
The support is for homes in council tax bands A to D, while funding for Scotland and Wales is included in the package.
To help pay for it, the tax surcharge on bank profits will double to 6% from January 2027 for 15 months.
The budget also extends a cut to fuel duty and a reduction in VAT on electricity bills until July 2027.
These measures come as the government says rising energy costs are putting pressure on households, and its forecaster expects little growth in household disposable income.
The budget raises taxes on income from savings and property too, with concerns that landlords may pass some costs on to tenants.
Fixed daily charges on household gas bills are due to be removed in 2027, with costs instead added to the price per unit of gas.
Decisions on future government spending, including welfare and how to fund higher defence spending, are due in the spending review next spring.
UK Chancellor John Healey announced a £100 winter energy payment for 20 million households in his first budget.
The government will raise the surcharge on bank profits from 3% to 6% for 15 months from January 2027.
The budget also extends a cut to fuel duty and a VAT reduction on electricity bills, and plans to remove fixed daily charges from household gas bills.
The measures come as higher energy costs and borrowing costs constrain the government’s support for households and businesses.
The package drew criticism that the £100 payment is poorly targeted and that higher taxes on savings and rental income could hurt savers and tenants.
- Who
- Chancellor John Healey announced the budget measures.
- What
- The budget includes a £100 winter energy payment for 20 million households and higher taxes on bank profits.
- When
- Healey presented the budget on October 28, 2026. The bank surcharge increase is due to start in January 2027.
- Where
- The budget was presented to the House of Commons in London.
- Why
- The bank tax increase is intended to help fund household energy relief and provide families with breathing space.
This story does not have two clearly opposing sides.
John Healey presented his first budget to the House of Commons.
The surcharge on bank profits is due to rise from 3% to 6% for 15 months.
The government plans to remove fixed daily charges from household gas bills.
The extended VAT reduction on electricity bills and fuel duty cut are due to last until this month.
- Household payment
- £100 for 20 million households
- Eligible council tax bands
- A to D
- Bank profits surcharge
- Rises from 3% to 6% for 15 months
- National minimum wage increase
- 3.9% to £13.21 per hour
- Business rates relief threshold
- Rises from £12,000 to £18,000
14 sources
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UK raises bank taxes to fund energy relief for households
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Gegen hohe Energiekosten: Grossbritannien bittet die Banken zur Kasse
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Britischer Haushalt: Mindestlohn hoch, Dosenbohnen zollfrei
UK budget lifts tax on bank profits to extend energy support
موازنة هيلي توازن بين تخفيف أعباء المعيشة والضبط المالي وسط تداعيات الحرب
What people are saying
I am looking to our banks to help fund breathing space for British families
It’s a budget for business, big and small, delivered at a time when global uncertainties and pressures are swirling worldwide and hitting people here in Britain
The chancellor has missed the mark with badly targeted support that has left families facing a tough winter as energy bills rise