Windfall tax on colossal bank profits could raise £19bn in 2026

Tuesday 4th August 2026 - A windfall tax on bank profits could raise £19bn this year from Britain’s four biggest banks alone, according to new analysis from campaign group Positive Money.

The figure comes as HSBC reported profits of £14.5bn for the first half of 2026 this morning. This follows announcements from Barclays, Lloyds Bank and NatWest last week that they made £6.1bn, £4.3bn and £4.3bn, respectively, over the same period. This brings the big four’s total profits to £29.2bn for the first six months of the year, which is a 21% increase on H1 2025. These banks have paid out almost half of this (£13.7bn) to shareholders through dividends and share buybacks announced so far this year, demonstrating that they can easily be paying more tax.

Based on banks’ H1 results and latest guidance, Positive Money estimates that a windfall tax on banks’ UK profits at a rate of 38% - in line with the UK Government’s windfall tax on oil and gas companies - would raise £19bn from the big four banks alone if announced in this year’s Autumn Budget. 

This tax has been specifically designed to only target profits made from the UK public, rather than those made from banks’ wider investment activities, in order to assuage concerns that a windfall tax would make the UK’s financial sector less competitive than its international counterparts. By exclusively targeting domestic retail banking, the incentive for banks to move commercial operations overseas would be eliminated.

To put this figure into perspective, £19bn would be enough to cover the cost of Andy Burnham’s VAT cut from electricity bills (£850m), the £2 cap on bus fares (£500m) and the business rates cut for pubs, clubs and music venues (£100m) more than 13 times over.

The huge profits banks are making - which broke records in 2023 and 2024, and almost again in 2025 - are being driven by the Bank of England’s interest rate hikes in response to inflation, rather than improved products or services. Higher interest rates aren’t just being paid to banks by UK households and businesses, but also by the central bank itself, to the tune of tens of billions each year - a cost ultimately borne by the Treasury. 

The Trades Union Congress (TUC) have also been calling for a windfall tax on bank profits, and used the fact that banks paid out £25bn in bonuses in the year to March as proof that they can easily stand to pay more tax.

Sara Hall, Co-Executive Director at Positive Money, said:

“Interest rate rises have landed us in a lose-lose situation: not only have they proven ineffective at taming inflation coming from overseas pressures, they’ve also handed windfall profits to banks, directly at the public’s expense.

“Previous governments have allowed the powerful banking lobby to persuade them against taxing these record-breaking profits in recent years, despite overwhelming public support for the policy.

“We’re calling on Andy Burnham to break with his predecessors by resisting the demands of City lobbyists and reclaiming these lost billions with a windfall tax on bank profits, the proceeds of which could be used to fund truly life-changing support for the households and businesses struggling to pay their bills right now.”

Notes to editors:

• Positive Money’s full analysis can be found here: https://www.datocms-assets.com/132494/1785825253-2026-bank-windfall-tax-estimates.pdf   

• The TUC found that bankers bonuses totalled £25bn in the year to March 2026: https://www.tuc.org.uk/news/bank-bonuses-hit-ps25-billion-tuc-says-hike-bank-windfall-tax-long-overdue 

• BBC Verify was used to confirm the cost of Andy Burnham’s cost of living policies: https://www.bbc.co.uk/news/articles/cy078kj0ezyo  

• The TUC found two-thirds of people support a windfall tax on banks: https://www.tuc.org.uk/news/public-overwhelmingly-back-wealth-tax-package-fix-public-services-and-rebuild-britain-new-tuc 

Contact:

For more information or to speak to a spokesperson please contact Chloe Musto at press@positivemoney.org.uk 

About Positive Money:

Positive Money is an international research and campaign organisation working to redesign our economic system for social justice and a liveable planet. Set up in the aftermath of the financial crisis, Positive Money is a not-for-profit company funded by charitable trusts and foundations, as well as small donations from its network of supporters. Find out more: www.positivemoney.org 

ENDS