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London’s banking elite are pressing the government for stability in fiscal policy ahead of the critical Autumn Budget, set for November 26. With mounting speculation that Chancellor Rachel Reeves could impose new taxes on the sector to plug Britain’s £62 billion ($83.5 billion) budget deficit, senior executives are warning that overburdening financial services could undermine growth, competitiveness, and investment.

The financial services industry, which generates around 10% of the nation’s tax revenue, remains central to the UK economy. But with growth stagnating in July after a modest 0.3% GDP expansion in the second quarter, concerns are mounting that excessive taxation could deter business confidence just as the sector is beginning to recover from global trade shocks earlier in the year.

Bank Leaders Sound the Alarm
Barclays CEO C.S. Venkatakrishnan cautioned that “milking the financial sector” would ultimately reduce competition and suppress growth. Speaking from Canary Wharf, he emphasized that London remains one of the world’s two leading financial hubs and needs supportive policies, not punitive ones, to maintain its position.

J.P. Morgan’s Conor Hillery echoed this sentiment, highlighting that investors crave predictability when making decisions on acquisitions and listings. He pointed to a wave of new deal activity and a recent £150 billion ($202 billion) inflow from U.S. companies as evidence of renewed optimism in the UK’s capital markets. According to Hillery, London remains “the premier capital market in Europe,” but its advantage depends on sustained policy clarity.

Citi UK CEO Tiina Lee added that businesses are impatient for reform. She acknowledged Reeves’ vocal support for strengthening London’s global financial standing, but warned that delays in policy implementation risk stalling momentum. Lee underlined that her clients are not actively looking to leave Britain but are pressing for a consistent, competitive tax environment.

Global Competition Intensifies
The calls come at a time when rival financial hubs are sharpening their competitive edge. New York continues to attract global listings, while Singapore and Dubai are vying for greater financial prominence. If the UK adopts harsher tax policies, analysts warn it could drive high-net-worth individuals and multinational firms to friendlier jurisdictions. Indeed, in 2024 alone, around 10,000 millionaires left London, citing concerns over the government’s increasingly aggressive approach to taxing the city’s “non-dom” wealthy elite.

Policy Roadmap and Market Outlook
Over the summer, the UK government announced a series of reforms aimed at making its financial services more competitive. These included loosening regulatory constraints, expanding ties with global markets, fostering retail investment culture, and bolstering research funding in areas such as artificial intelligence and fintech. Reeves has repeatedly emphasized that financial services remain “at the heart” of the UK’s growth strategy.

Still, the prospect of a windfall tax lingers, with reports suggesting such measures could be on the table to shore up public finances. Market watchers say the balance between raising revenue and preserving London’s attractiveness as a financial hub will be one of the defining themes of this year’s Autumn Budget.

As the budget deadline approaches, the message from London’s banking executives is clear: stability and predictability must take precedence over short-term revenue grabs. How Reeves navigates this balancing act could determine whether London strengthens its role as a global financial powerhouse—or risks losing ground to its rivals.