TUC says up taxes on banking profits to fight rising cost of living

The Trades Union Congress (TUC) has called for Andy Burnham to raise taxes on banks, following Barclays‘ announcement of bumper second-quarter profits.

The trade union body is advocating for the government to spend the money on a social energy tariff. According to the TUC, this measure could decrease middle and lower-income household energy bills by as much as £559 a year.

Paul Nowak, the TUC’s general secretary, said:

Big banks like Barclays are raking it in while working people and local businesses are struggling. High interest rates have been a boon for banks but have meant mortgage misery and higher bills for the rest of us.

Andy Burnham has rightly pledged to prioritise tackling the cost-of-living crisis. With the war in Iran rumbling on, energy prices are only going to rise – and households will need more support in the months ahead.

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This is not a ‘hard choice’. Barclays’ bonanza profits show that banks can easily afford to pay more tax. This is a chance for the new Prime Minister and Chancellor to show whose side they’re on. It’s time to increase the bank surcharge and tax banks to bring down energy bills.

TUC criticises Barclays’ bumper profits

On Tuesday, Barclays posted pre-tax profits of £3.3 billion for Q2. That represents a 31% increase on the year, pushing the lender’s half-year profits to £6.1 billion, the Guardian reported.

Meanwhile, the wider financial and insurance sector paid out a massive £25 billion in bonuses alone in the year leading up to Q1 of 2026.

As things stand, banks pay an extra 3% in corporation tax on profits over £100 million. However, that surcharge stood at 8% up until 2023, when it was reduced under Tory rule. The Lib Dem’s analysis of Office for Budget Responsibility figures suggested that this would cost the UK £22 billion over the following six years.

Given both Barclay’s massive profits and the huge losses from reducing the surcharge in the first place, the TUC has urged the government to raise bank taxes once again.

As an illustration, the TUC gave estimates for the money generated by three different levels of taxation over 4 years:

• Simply reinstating the 8% surcharge would raise £9 billion
• A 16% surcharge would net £24 billion
• A 35% surcharge — which happens to match the Tories’ windfall tax on energy companies — would make the UK a massive £60 billion

Featured image via the Canary

By Grace

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