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MPs open probe into leak of Healey’s Budget bank tax hike
The Treasury Committee has opened an inquiry into a possible leak of the planned increase to the UK banking surcharge, after details emerged hours before the Budget. The early report was followed by sharp rises in Lloyds, NatWest and Barclays shares, as investors welcomed an increase seen as less severe than expected.
Treasury Permanent Secretary James Bowler said banks and their representatives had not been briefed, while acknowledging that more government officials knew the details ahead of the Budget. Chancellor John Healey raised the surcharge to 6% for 15 months; reports had said the rise would be temporary and below the 8% expected. Committee chair Meg Hillier criticised previous leak inquiries as inconclusive, and the Financial Conduct Authority said it would consider whether unlawful disclosure or poor information handling had affected markets.
In short
- MPs are investigating a possible Budget leak about the bank surcharge.
- The tax was raised to 6% for 15 months.
- Regulators may examine whether the disclosure improperly affected markets.
Steelman: both sides, in good faith
The strongest fair case each way — we don't pick a winner.
The case for
A thorough inquiry is justified because advance disclosure of a tax decision can give some investors an unfair advantage and undermine confidence in both markets and public decision-making. The sharp share-price movements make it important to establish what information was shared, when, and whether any rules were breached; previous inconclusive inquiries strengthen the case for a credible, transparent examination.
The case against
The early report and subsequent share rises do not by themselves prove that there was an unlawful leak or that anyone traded on privileged information. Officials say banks and their representatives were not briefed, and a wide-ranging inquiry could consume public resources or imply wrongdoing before the facts are established; a focused review by the relevant authorities may be more proportionate.
Explained simply
The bank surcharge is an extra tax on the profits of banks operating in the UK, on top of corporation tax. Changes to it can affect how much banks pay and can influence how investors value their shares.
The Treasury Committee is a group of MPs that examines the work of the Treasury and holds officials to account. The Financial Conduct Authority regulates financial markets, including rules intended to prevent people trading on confidential information.
The issue matters because information about tax changes can affect share prices before they are announced. An inquiry can examine how details were handled and whether any rules were broken.