BANKING bonuses are set to hit a record £25 billion this year, sparking union calls for a windfall tax hike to fund a social energy tariff and permanently cut most people’s bills. 

The TUC called for the “common sense and long overdue” increase in the bank surcharge tax ahead of the Chancellor Rachel Reeves’s swansong Mansion House speech today.

Official figures show the finance and insurance industry’s average weekly bonus at £431 over the first quarter of 2026.

The record high in cash terms and in real terms since the 2008 financial crash means the sector is set to spend £25bn on bonuses on 1.1bn staff this year, the union federation found.

The big four banks — Barclays, HSBC, Lloyds and NatWest — also registered more than an eye-watering £1bn in profits a week over the period.

TUC general secretary Paul Nowak said: “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 the money raised to cut people’s energy bills.”

The TUC found that the annual growth in bonuses is also rising — and was 16 per cent in the first quarter of 2026, the second-highest rate since 2008.

Its analysis, meanwhile, shows a social energy tariff could cut energy bills to all those on low and middle incomes by up to £559 a year at an annual cost of between £3.4-5.9bn. 

Currently, the bank surcharge is an additional 3 per cent corporation tax on the profits of banking companies above £100 million.

The Tories reduced this from 8 per cent and removed a cap on bank bonuses to curb the excessive risk-taking that led to the 2008 financial crash in 2023.

TUC analysis shows raising the surcharge to 16 per cent would deliver £24bn over the next four years.

Raising to 35 per cent — the same level as the windfall tax the Tories imposed on energy companies — would deliver £60bn over the period.

Positive Money campaign group’s co-executive director Sara Hall said: “Record bonuses to celebrate record profits — the cost-of-living crisis must be something of a fantasy to City bankers.

“Banks aren’t redirecting the windfall profits they’ve made from higher interest rates towards the households or businesses struggling to pay them, so it falls to the government to do so in their stead.

“Andy Burnham is being handed a rare opportunity to rebalance the scales in the public’s favour — he should seize the chance to implement this popular policy that won’t cost the government a penny, but might just earn it some desperately needed trust.”

A Momentum spokesperson said: “Banks are pocketing obscene bonuses while millions of UK households struggle to make ends meet. 

“If Andy Burnham is serious about redistributing wealth and power, he must hike the windfall tax on banks and make taxing extreme wealth a top priority.”

The Treasury was contacted for comment.

Ms Reeves is expected to announce plans to help small businesses grow in what it likely to be one of her last acts as Chancellor today.

She will set out expanded financial support for small and medium-sized enterprises (SMEs) in her Mansion House speech.

The flagship measure is the expansion of a government guarantee on commercial loans for SMEs, aimed at helping British businesses borrow money to help them grow their operations.

Labour MP Richard Burgon said: “It’s totally obscene that banks are raking in billions in unearned windfall profits while ordinary people are being hammered by soaring mortgages and the cost-of-living crisis.

“The government should tax those excess profits and use the money to support households and rebuild public services starved of investment.

“There is simply no reason why the banks should not face the same type of tax on their unearned and undeserved windfalls as the energy companies have.”