Green Party proposes windfall tax on major UK banks

The Green Party has proposed a 38% windfall tax on the domestic profits of major UK banks that exceed £800 million. The party aims to raise approximately £19 billion from these levies to support small and medium-sized enterprises (SMEs). The proposed funds would be used to double the Employment Allowance for SMEs, potentially reducing their National Insurance bills by up to £10,500 to alleviate cost pressures.

In response to speculation regarding potential taxes on the financial sector, UK Finance has warned the government that such levies could damage investment and international competitiveness. The industry group argues that British banks already face a high effective tax burden of nearly 47%, which is significantly higher than rates in New York, Frankfurt, and Amsterdam. UK Finance cautioned that increasing taxes could undermine the tax base the government intends to grow.