Barclays Chief Backs Chancellor John Healey as Bank Tax Rises Loom
CS Venkatakrishnan says higher UK bank taxes would be bearable, because roughly half of Barclays’ money is earned outside Britain
By AXY Politics Desk ·
Key points
- Barclays chief executive CS Venkatakrishnan said higher bank taxes in the UK budget would be “bearable” and gave Chancellor John Healey his full backing.
- Bank tax rises are expected to be a headline measure in Healey’s budget next week.
- Venkatakrishnan said Barclays effectively makes about half of its money outside the UK, which he argued limits the financial hit from a UK tax rise.
- Banks narrowly escaped higher levies in last year’s budget and have lobbied intensively against bank tax rises since.
- JP Morgan boss Jamie Dimon said earlier this year he could scrap a planned £3bn London headquarters if the UK government became hostile to banks.
Barclays chief executive CS Venkatakrishnan has said that higher taxes on banks in Chancellor John Healey’s budget would be “bearable” for his bank, and he has given Healey his public backing ahead of the budget, which is expected next week. Speaking to reporters, Venkatakrishnan said: “I deeply respect the responsibility that the chancellor has and he has our full support and backing.”
The remarks came as bank tax rises were expected to be one of the headline measures in the budget. Reporting on the day described Venkatakrishnan as seeming to have admitted defeat over the tax hikes. Asked whether Barclays might move assets or investment out of the UK and into the United States, where the bank also has operations, he did not point to any such move. He gave the chancellor his backing instead.
For readers who do not follow banking or Treasury policy closely, here is the basic picture. The chancellor of the Exchequer is the UK’s finance minister. He runs HM Treasury, the government department that handles public money, and he sets the country’s taxes and spending. The budget is the main fiscal event of the year, where the chancellor announces how much the government will raise in tax and how it will spend it. When a budget is described as having a headline measure, that is the change expected to get the most attention.
A bank tax rise is, in simple terms, the government taking a larger share of what banks earn. The sector already pays several taxes, so a change would add to what banks pay the Treasury. That money helps fund public services, which is why a bank tax can affect ordinary households even though it lands on banks first. Whether the cost is passed on to customers, absorbed by shareholders or shifted into decisions about where to invest is one of the central arguments in this debate.
Venkatakrishnan’s Message to the Chancellor
Venkatakrishnan’s wording was careful and measured. He said he recognised that the chancellor and the government had been “entrusted with an important duty by the public and the people”, and that they had to balance a host of considerations. He then described Healey as “the man in the arena”, and said he deeply respected the responsibility Healey carries and wished him well.
That language matters because it signals that Barclays is choosing not to fight the measure in public. Bank chiefs can criticise tax plans loudly, and some have done so in the past. Venkatakrishnan did the opposite. He framed the chancellor’s job as a hard one and placed Barclays on the same side of the argument, at least in tone.
He also said Healey’s long-term goal was the same as Barclays’ long-term goal, which he named as growth. That is a familiar argument in UK economic policy. Ministers and business leaders often agree that taxes should raise money without discouraging investment, hiring and expansion. Venkatakrishnan was placing the bank’s interests in that frame, arguing that both sides want the economy to grow.
Why Barclays Says the Tax Is Bearable
On the cost to the bank itself, Venkatakrishnan was direct. “It’s bearable,” he said. He then explained why. The issue, in his words, was one of proportion and of market signalling.
Proportion means the size of the tax against the size of the business. Market signalling is less familiar. It refers to what a decision tells investors, lenders and company boards about how a country treats its banks. A tax can be affordable in cash terms and still change how a board thinks about where to put new money. Venkatakrishnan was saying that the number on the bill matters less to Barclays than the message the change sends.
That distinction is the heart of the debate. The government will have to weigh the money a bank tax raises against any effect on investment that the sector later points to. Barclays has chosen to say that the effect, for it, is manageable. Other banks may or may not take the same view.
Half of Barclays’ Money Comes From Outside Britain
The most important reason for the bank’s calm response may be where its money comes from. Venkatakrishnan said Barclays already operates as a bank that effectively makes half of its money outside the UK. He used that fact to argue that the bank does not face a large financial hit from a rise in UK taxes. “This is not a question of a financial hit to us,” he said, in substance, as he explained the point.
That matters in practice. A large bank with a big share of its income abroad can, in principle, be more flexible about where it earns profit, where it invests and where it hires. A tax change in one country is therefore not the same as a change to the group’s total earnings. Barclays has operations in the United States, and the question put to Venkatakrishnan about moving assets or investment toward that market reflects this flexibility.
This also explains why the UK may matter to Barclays in a different way from how it matters to a bank that earns most of its money at home. For a domestic-focused lender, a tax rise lands on almost the whole business. For Barclays, the UK is one important part of a wider group. Venkatakrishnan’s comments make that position clear, while stopping short of saying the UK is unimportant to the bank.
How Banks Escaped Higher Levies Last Year
Venkatakrishnan’s comments come after a long period of lobbying. Bank bosses have been lobbying intensively against bank tax rises since they narrowly escaped higher levies in last year’s budget. That means the sector got close to a heavier tax burden and was relieved to avoid it, and it has been determined not to lose ground in the next round.
The previous budget was delivered by Rachel Reeves, who was then the Labour chancellor. In her 2025 autumn budget she spared the banking sector from further tax rises. The sector’s lobbying since then has been a way of keeping that outcome from being reversed. Each new budget is a fresh chance for the government to revisit the question, and each one brings a fresh round of warnings from bank leaders.
That history gives the latest comments more weight. When a bank chief publicly says a tax rise is bearable and backs the chancellor, it suggests the sector is picking its battles. It also suggests Barclays sees its relationship with the Treasury as one worth protecting, at least for now. A bank that openly attacks a budget may find it harder to win favourable treatment later, and that calculation is likely to be part of the picture.
Jamie Dimon’s £3bn London Headquarters Warning
The sector’s warnings have not been confined to Barclays. JP Morgan boss Jamie Dimon said earlier this year that he could scrap plans for a new £3bn London headquarters if the UK government became hostile to banks. The tower is set to house more than half of JP Morgan’s 23,000 UK staff.
That threat shows how the debate reaches ordinary workers. A headquarters project means construction jobs, office jobs and a long-term commitment to a city. A threat to scrap it is a way of putting a price on political decisions. It is also a message the chancellor will have heard, and one that other bank leaders may be weighing as they decide how loudly to speak.
Dimon’s statement and Venkatakrishnan’s remarks point in different directions. One is a warning that a hostile climate could cost the country a major investment. The other is a pledge of support for the chancellor. Together they show how banks are trying to shape the tone of the budget debate without necessarily losing the argument on tax.
What the Budget Could Mean for Bank Customers and Investors
The next test is the budget itself. Once Healey sets out the detail, the central questions will be how large the bank tax rise is, how it is structured and whether it is presented as a lasting change or something narrower. Those details will determine whether Barclays’ description of the cost as bearable still holds, and whether the bank’s argument about signalling is tested.
If the change is modest, it may pass with limited public fight from the sector, which would fit the tone Barclays has set. If it is larger, banks may return to earlier warnings about where they invest and hire. In that case, the clearest sign to watch will be whether other bank leaders follow Venkatakrishnan’s lead and publicly back the chancellor, or whether the pressure from Dimon’s side grows louder.
Separately, the same live coverage carried a figure that puts the wider pay debate in context. The Office for National Statistics said the gender pay gap for full-time employees in the UK has continued to decline. It was 6.8% in April 2026, down from 7.2% in April 2025. That compares with 9.4% a decade ago and 16.4% 25 years ago. The gap measures the difference between men’s and women’s pay, and the trend is one the government tracks closely when it judges its progress on fairness at work.
For readers, the budget will show more than a tax rate. It will show how the government plans to fund its spending, and how hard it is willing to push a sector that is central to lending, jobs and investment. Venkatakrishnan has said his bank can live with the change. The rest of the sector, and the chancellor, will now have to respond.
Questions and answers
What did the Barclays chief say about bank taxes?
Barclays chief executive CS Venkatakrishnan said higher bank taxes in the budget would be bearable and that he fully backed Chancellor John Healey. He said the bank effectively makes about half of its money outside the UK, so the financial hit is limited.
When is Healey’s budget?
The budget is expected next week, and bank tax rises are expected to be one of its headline measures.
Why are banks lobbying against tax rises?
Bank bosses have lobbied intensively against bank tax rises since they narrowly escaped higher levies in last year’s budget. JP Morgan boss Jamie Dimon has also said he could scrap a planned £3bn London headquarters if the government becomes hostile to banks.
Why does Barclays say the tax is bearable?
Venkatakrishnan said Barclays already makes effectively half of its money outside the UK, so a UK tax rise is not a large financial hit. He also said the issue was one of proportion and market signalling.
Topics: Barclays, CS Venkatakrishnan, John Healey, UK budget, bank tax, JP Morgan, Jamie Dimon
Sources: The Guardian Politics
https://axynewsglobal.com/article/barclays-chief-backs-chancellor-john-healey-as-bank-tax-rises-loom