Budget 2026: Healey hikes taxes on banks and landlords to fund £100 handouts to 20m households
Summary
Chancellor John Healey announced a £100 winter payment for households in council tax bands A–D in England, alongside measures to reduce some business costs. He will fund the package partly through higher taxes on banks and income from savings and property, while official forecasts point to weak growth in household disposable income and higher energy costs.Key Facts
- The £100 payment will go to 20 million households in England in council tax bands A–D.
- The cost of the payment package is £2.6 billion, including funding for the Scottish and Welsh governments to offer similar support.
- The additional levy on bank profits will double to 6% for 15 months.
- Tax rates on income from savings and property will rise by 2 percentage points.
- The Office for Budget Responsibility said the higher tax on rental income could reduce the supply of rental homes and push rents up.
- The government will cancel planned fuel duty increases and extend a VAT cut on electricity prices until next summer.
- Businesses in retail, hospitality and leisure will receive a higher business rates relief threshold, rising from £12,000 to £18,000.
- The official forecaster cut its outlook for economic growth in 2027 and forecast virtually no growth in household disposable income.
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