TUC calls for windfall tax on banks to cut bills as 1 in 3 cut back on hot water and electricity use to reduce their spending

• ENERGY PRICE CAP: TUC calls for windfall tax on bank profits to cut energy bills for the majority of households by up to £559
• Stark new poll findings show households up and down the country are still up against it
• Almost a quarter (23%) are skipping meals each month to save money while 3 in 10 (29%) say they have had to use savings some months, most months or every month in the last year to cover their monthly costs

Ahead of the energy price cap announcement today (Wednesday), the TUC has renewed its call for a windfall tax on bank profits to pay for a cut to the majority of UK households' energy bills.

The call comes as new polling conducted by YouGov for the TUC shows that in the three months up to late June more than a third (35%) of adults had cut back on hot water usage for baths and showers at least several times a month to reduce their spending and 15% say they do this on most days. This is despite the fieldwork being complete in warmer months of the year.

And to reduce their spending, more than a third (37%) did not use electrical appliances as often as needed regularly, with 15% doing this every day or most days.

The polling also revealed in the last three months before the research (March to June):

• Almost a quarter (23%) refused a meal to save money on a monthly basis.
• Two in five (40%) avoided putting their heating on at least several times a month.

While almost a quarter (23%) said they have made large or significant cutbacks on food shopping in the last year.

Meanwhile, many said they were going into debt or dipping into savings to get by:

• A fifth (20%) said that they had gone into debt once, a couple of times or several times because they had been unable to pay an unexpected bill in the last year, with 15% saying this had happened at least a couple or several of times.
• More than a fifth (22%) said that they struggled to or could not afford their monthly costs.
• Half (51%) said they had to use their savings to cover their monthly costs in the last year, with over a quarter (29%) saying this happened regularly (every, most or some months).
• A quarter (25%) said they had gone into debt to pay for monthly expenses in the last year, with 14% saying this had happened regularly (every, most or some months).

More than a fifth (21%) said that they hadn't been able to put any money into savings in the last year.

Cost of living pressures

The TUC is calling for an increase in the tax on profits of banks to pay for a social tariff and cut bills for the majority of households by up to £559 a year.

The government has been straight out of the blocks with measures to tackle the cost of living, including scrapping VAT on electricity bills.

The TUC says scrapping VAT is welcome and will help to cushion the blow to households but points to longer term increases in recent years.

While Trump's illegal war has seen households hammered by further jumps in energy bills, costs have been stubbornly high since Russia's illegal invasion of Ukraine.

TUC analysis shows that average annual payments for energy bills have gone up by £437 compared to May 2021 costing households a total of £2,500 in the time since (up to May 2026).

At the same time, bank profits are booming. The big four banks are making more than £1bn a week, based on the first half of the year.

Currently the bank surcharge is an additional 3% corporation tax on the profits of banking companies above £100 million, which was reduced from 8% in April 2023 by the Conservatives just as bumper profits kicked in alongside higher interest rates.

The TUC is calling for the government to increase the surcharge to raise up to £60 billion over the next four years and help cover the cost of the social tariff.

• A 16% surcharge, which is doubling what it originally was before the Conservatives cut it, would deliver £24bn over four years.
• A 35% surcharge, which would be the same level as the windfall tax the Conservatives imposed on energy companies, would deliver £60bn over four years.

Even the bare minimum of reversing the Tory cuts and setting it at 8% would raise £9bn over four years.

TUC General Secretary Paul Nowak said:

Households up and down the country are under the cosh. Too many are skipping meals, dipping into savings and having to cut back on life's essentials.

That's why Andy Burnham is right to prioritise the cost of living. But the scale of the crisis means the government is going to have to keep going on measures to boost living standards starting with a tax on banks' enormous profits to cut energy bills for the majority of households.

It's plain common sense. Banks are raking it in while many up and down the country are struggling to get by they can well afford to pay more tax to ease the pressure on working people.

ENDS

Notes to editors:

Note on polling: All figures, unless otherwise stated, are from YouGov Plc.  Total sample size was 2,344 adults. Fieldwork was undertaken between 24th - 25th June 2026.  The survey was carried out online. The figures have been weighted and are representative of all UK adults (aged 18+).

Analysis on energy bills and social tariff call: https://www.tuc.org.uk/news/tuc-calls-social-tariff-cut-energy-bills-two-thirds-households-new-price-cap-starts

Permanent standard social tariff

Outside of acute energy crises, the TUC's proposal is for a long-term permanent standard social tariff that protects lower-income households from high market-rate costs, improving the cost of living for half of households.

Under the TUC's proposed standard social tariff, proposed to set a new baseline for bills support outside of crisis periods, based on current prices:

• Lowest income households would save £466 a year: a 25% reduction to their energy bills.
• Below median households would save up to £279 a year: a 15% reduction to their bills.

Emergency ratchet

In times of acute energy crises, such as the current period, households would get an emergency boost as support ratchets up:

• Lowest income households save up to £559 per year: An immediate 30% reduction to total household bills to the 17% of households whose combined annual income (adjusted for household size and composition) falls below the relative poverty line.
• Households below the median save up to £373 a year: A 20% reduction would be made for a further 33% of households whose combined annual income falls between the relative poverty line and median household income.
• Middle and some higher income households save up to £186 a year: A 10% reduction would be given to an additional 15% of households whose combined annual income falls between the median and mean of household income, bringing the total beneficiaries to 65% of households.

This approach would protect two-thirds of households from punishing rises, with the vast majority of remaining households still benefiting from the Price Cap. In our model, extremely large country estates, which can afford to pay more would no-longer be protected to the Price Cap, with the additional revenue used to help support lower income households.

The TUC says if put into place now, the scheme including the emergency tariff would cost £3.4-5.9bn per annum.