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Unions Call for Bank Tax to Cut Energy Bills
Confirmed
In Short: Unions in the UK are advocating for a tax on banks to help reduce energy bills, as millions of families face financial strain.
Unions in the UK are calling for a tax on banks to help reduce energy bills, according to reports. The leader of Britain's trade unionists, Andy Burnham, has proposed a 'social tariff' paid for by a bank surcharge, which would raise £9bn over four years, benefiting two-thirds of households, according to the TUC.
The TUC's demands extend beyond banks, with General Secretary Paul Nowak suggesting a windfall tax on social media companies and equalizing Capital Gains Tax with income tax. Nowak argues that the UK has a tax system that is better at taxing income than capturing wealth, and that the bank surcharge, which was reduced from 8% to 3% in 2023, should be reversed.
The proposal for a social tariff, which would provide a discount on bills based on household income, is expected to be popular among Labour MPs and supported by the Liberal Democrats and the Greens. However, UK Finance, representing major banks, argues that heavier levies would undermine the government's goal of growth and international competitiveness, as UK banks currently face a heavier tax burden than those in the US.
Nowak's proposal follows a poll by the TUC that suggests the majority of the public and supporters of all parties want to see a reduction in energy bills by taxing banks. The TUC will make a 'very clear call' on the government to introduce a social tariff at its congress next week, which could save up to £560 a year for two-thirds of households.
UK Finance, which represents banks and lenders, has suggested that such measures could damage international competitiveness and undermine the government's ambition to deliver growth in every postcode. Despite this, the TUC remains committed to its proposal, arguing that banks, which made maximum profits after being bailed out during the 2008 financial crisis, should now support the public.
What's confirmed
- Unions in the UK are calling for a tax on banks to help reduce energy bills, according to reports. The leader of Britain's trade unionists, Andy Burnham, has proposed a 'social tariff' paid for by a bank surcharge, which would raise £9bn over four years, benefiting two-thirds of households, according to the TUC.
- The TUC's demands extend beyond banks, with General Secretary Paul Nowak suggesting a windfall tax on social media companies and equalizing Capital Gains Tax with income tax. Nowak argues that the UK has a tax system that is better at taxing income than capturing wealth, and that the bank surcharge, which was reduced from 8% to 3% in 2023, should be reversed.
- The proposal for a social tariff, which would provide a discount on bills based on household income, is expected to be popular among Labour MPs and supported by the Liberal Democrats and the Greens. However, UK Finance, representing major banks, argues that heavier levies would undermine the government's goal of growth and international competitiveness, as UK banks currently face a heavier tax burden than those in the US.
- Nowak's proposal follows a poll by the TUC that suggests the majority of the public and supporters of all parties want to see a reduction in energy bills by taxing banks. The TUC will make a 'very clear call' on the government to introduce a social tariff at its congress next week, which could save up to £560 a year for two-thirds of households.
- UK Finance, which represents banks and lenders, has suggested that such measures could damage international competitiveness and undermine the government's ambition to deliver growth in every postcode. Despite this, the TUC remains committed to its proposal, arguing that banks, which made maximum profits after being bailed out during the 2008 financial crisis, should now support the public.
What's still developing
- Bank share prices have risen faster here than in New York," he said. The TUC's demands for tax-raising measures don't stop with the banks, with Nowak arguing the UK has "a tax system that's good at taxing income but not good at capturing wealth". Nowak suggests a windfall tax on social media companies and for the government to equalise rates of Capital Gains Tax with income tax. The economist and former minister Lord O'Neill - who has advised Burnham – said recently that wealth taxes were "the last thing that should be happening if we want to see more growth". Nowak responded: "With respect, I think he is wrong.
- "And millions of families up and down the country are worried about turning on their heating this winter." Burnham has already offered "breathing space" - as he calls it – on the cost of living by temporarily scrapping VAT on electricity bills from October.
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