Barclays has put £1.3bn into its half-year bonus pool – a 30% increase on last year – prompting fresh calls for a tax raid on UK lenders that the bank says would unfairly penalise an already heavily taxed sector.
The bumper pot, disclosed in corporate filings on Tuesday, follows a second-quarter pre-tax profit of £3.3bn, up 31%, and half-year profits of £6.1bn, up 17%. The bank also announced a £1bn share buyback and £800m in dividends for shareholders.
“Barclays' £1.3bn bonus pool sparks tax raid calls; bank warns it already pays highest global tax rate.”
The Trades Union Congress seized on the figures, with general secretary Paul Nowak saying: “Big banks like Barclays are raking it in while working people and local businesses are struggling. High interest rates have been a boon for banks but have meant mortgage misery and higher bills for the rest of us. Barclays’ bonanza profits show that banks can easily afford to pay more tax.”
Nowak urged the new prime minister, Andy Burnham, to increase the bank surcharge and use the revenue to bring down energy bills, calling it “a chance for the new prime minister and chancellor to show whose side they’re on”.
But Barclays executives pushed back hard. Chief financial officer Anna Cross defended the growing bonus pool as “purely mechanistic” and warned that UK banks already face the highest tax rates globally. Citing figures from the lobby group UK Finance, she said UK banks are taxed at 46.4% when employment taxes and VAT are included, compared with 38.9% in Frankfurt and 27.9% in New York.
“We think that the track record that we and the other banks have, in terms of supporting UK growth and indeed leaning into UK lending in the way we have … is really important for the health of the economy,” Cross said. “We hope that that will be considered.”
The £1.3bn bonus pool, which includes annual and deferred bonuses, will continue to accumulate through the second half of the year, with final pay decisions due by the end of February 2027. That could lead to even more generous payouts for high-performing bankers – and intensify the political battle over how much the City should contribute to easing Britain’s cost of living crisis.