New analysis from the TUC reveals bank bonuses have hit a post-crash record – as the union body calls for a hike in the bank windfall tax, which it says is “common sense and long overdue”.

Ahead of the Chancellor’s Mansion House speech on Tuesday, the TUC is calling for an increase in the bank surcharge tax to permanently cut energy bills for the majority of households through a social tariff.

Across the financial and insurance industry, a total of £25 billion was paid out in bonuses in the financial year ending in March 2026.

Analysis of the first quarter of 2026, when most bonuses are paid, show that bank bonuses have never been higher in cash terms – and saw their highest real-terms quarter since 2008.

Annual growth of bonuses is also escalating and was 16% in the first quarter of 2026. This has only once been higher since 2008 financial crash.

A cap on bank bonuses to curb the excessive risk taking that led to the 2008 financial crash was removed by the previous Conservative government in 2023.

The union body says that “while sky-high bills are looming for ordinary working people, bank bonuses are booming” which is further evidence that banks could easily afford to pay more tax.

Currently the bank surcharge is an additional 3% corporation tax on the profits of banking companies above £100 million, which was reduced from 8% in April 2023 by the Conservatives.

TUC analysis reveals an increase in the bank surcharge could raise between £9bn-60bn over the next four years:
A 16% surcharge, which is doubling what it originally was before the Conservatives cut it, would deliver £24bn over four years.

A 35% surcharge, which would be the same level as the windfall tax the Conservatives imposed on energy companies, would deliver £60bn over four years.

Even just reversing the Tory cuts and setting it at 8% – which the TUC says is the “bare minimum” – would raise £9bn over four years.

Eyewatering profits

The bonus figures come on top of latest profit data which show the big four banks – Barclays, HSBC, Lloyds and Natwest – have made £13.8 billion in the first quarter of 2026 alone, despite HSBC profits taking an unexpected hit because of fraud-related charges.

This comes after the big four banks made profits of £45.7bn in 2025. TUC analysis of the wider banking sector shows profits are 40% higher than in the lead up to the 2008 financial crisis.

The TUC says that an increase in the bank surcharge could raise significant funds over the coming years – particularly given the scale of banks’ current windfalls.

The union body also warns that if – as inflation goes up – the Bank of England holds interest rates at a higher level than previously expected, banks will be set to make even more money.

Bank profits have been turbocharged by the removal of the bank surcharge just as high interest rates meant excess profits for banks.

This has led to higher returns both from net interest (the difference on interest charged to borrowers and paid to savers) and interest paid to banks on reserves they hold at the Bank of England.

Tax banks to cut bills

The TUC is calling for an increase in the bank surcharge tax to deliver a permanent social tariff to cut energy bills to all those on low and middle incomes by up to £559 a year.

The scheme design includes a built-in trigger for support levels to ratchet up during acute energy cost crises – such as the current period – to keep bills manageable.

This will protect living standards and help ensure consumer spending holds up. It will also protect our economy from sustained shocks by keeping energy prices down and helping to reduce inflation.

The TUC says if put into place now, the scheme – including the emergency tariff – would cost £3.4-5.9bn per annum, which could be paid for through increasing the bank surcharge. The union body says this would boost the economy far more than allowing big banks to stockpile excess profits.

While sky-high bills are looming for working people, bank bonuses are booming.

Every time there is talk of taxing banks, some of the richest people in the country start whining and try to claim they can’t afford to pay any more.

But the big banks are making a killing off the back of higher interest rates and mortgage misery across the country. They can well afford to pay more tax.

The case for an increase in the bank surcharge tax has never been greater. It’s a long overdue common-sense solution – and the government should use to money raised to cut people’s energy bills.