Pre-Budget speculation fuels rumours of bank windfall tax and landlord NICs

With the Chancellor under pressure to address the UK’s borrowing costs (Government long-term bond yields hitting a record high on 2 September 2025 as reported by The Guardian (2 September) various potential options involving increased taxes have been circulating including a windfall tax on banks and introducing NICs on landlords’ rental income.

The Institute for Public Policy Research (IPPR) recently published a report (How to end the £22 billion annual taxpayer losses at the Bank of England) recommending a new ‘quantitative easing reserved income levy’ on commercial banks to attempt to recoup interest rate losses at the Bank of England (an unintended consequence of the BoE’s quantitative easing (QE) programme which the IPPR says is costing the UK taxpayer £22bn a year). This would be a tax on windfall profits directly linked to QE-related reserves. The IPPR report says: ‘while this levy would hit commercial banks’...