John Healey’s Budget: bank, gambling and online VAT measures among possible revenue options

Chancellor John Healey faces pressure to raise revenue in the UK Budget scheduled for 28 October 2026, as economists estimate that his room to meet fiscal rules may have narrowed. BBC News reported on 25 October that taxes on banks and gambling machines, along with a change to VAT collection on online marketplaces, are among the possibilities being discussed. The government has not confirmed those measures.

Economists think the chancellor’s fiscal headroom may have fallen from about £24bn six months ago to as little as £11bn, partly because government borrowing costs have risen, according to the BBC. The amount matters because it measures how much room the government has against its fiscal rules before it must change taxes or spending plans. The BBC also described pressure to help households with living costs and to fund defence.

Bank taxes and gambling machines

The BBC reported a widespread belief among bank bosses that Healey is preparing to raise taxes on banks. It described that as an expectation, not an announced policy. Increases to capital gains taxes and an extension of the mansion tax had also been raised as options, but government sources subsequently ruled them out, according to the BBC.

Former prime minister Gordon Brown has called for a higher tax on electronic gaming machines, citing gambling-related social harm, the BBC reported. The Social Market Foundation estimated that doubling the tax from 20% to 40% could raise £275m to £460m, depending on how gamblers respond. That range is an estimate for a proposal, rather than revenue already secured for the Budget.

A higher machine tax could be passed on to users through worse odds, the BBC said. Anti-gambling groups argue that could discourage use. Gambling-industry representatives say a rise could make betting shops less profitable and lead to closures, with possible consequences for payments to horse racing. Those competing assessments show why the amount raised would depend on behaviour as well as the tax rate.

Online marketplace VAT and spending pressure

Reports also suggest that Healey may make large online marketplaces responsible for collecting VAT owed by retailers selling through their platforms, according to the BBC. That would change who collects an existing tax; the BBC presented it as a possibility, with no confirmed Budget decision.

The debate also extends to spending. The Conservatives claim that restricting access to welfare payments could save £36bn a year, while Reform claims £50bn, the BBC reported. Independent analysts question whether savings on that scale are realistic. The Office for Budget Responsibility projects health and sickness benefits to rise from £68bn this year to £81bn in 2031, according to the BBC.

HM Treasury has confirmed that the Budget is scheduled for Wednesday 28 October 2026. That is when the government is due to set out which tax and spending choices it has made.