Healey leaves bank bosses guessing on windfall tax after crunch Downing Street talks

Chancellor John Healey has left the bosses of Britain’s biggest banks guessing whether lenders will be hit with a tax rise in his first Budget, after a crunch meeting in Downing Street on Tuesday morning ended with no indication of his plans.

The summit, which ran for just under an hour and was chaired by City minister Lucy Rigby, brought together the chief executives of Barclays, HSBC, Lloyds Banking Group, Nationwide Building Society and NatWest, The Times reported. HSBC boss Georges Elhedery joined by video link.

Sources said bank executives warned the chancellor that a windfall tax would damage investor sentiment towards the UK, with one person saying there was a collective recognition that windfall taxes risk making Britain “increasingly uninvestable”. Elhedery reminded Healey that HSBC had attracted an activist investor in recent years, as an example of the difficulties lenders face managing shareholder sentiment.

Healey, in what was described as “listening mode”, told the bosses the UK was in a tough fiscal position but that he had yet to take decisions on taxes. “Nobody came out any the wiser,” one attendee said.

The meeting comes ahead of the Budget on October 28. The Trades Union Congress, Positive Money and the Green Party have all called for a levy on banks’ profits to fund cost-of-living measures, while lenders argue they already face a heavier burden through the industry-specific corporation tax surcharge and balance sheet levy.