Chancellor Rachel Reeves has sparked controversy by not ruling out tax increases in her upcoming Budget, scheduled for November 26. In a speech delivered on Tuesday, Reeves indicated that the government may need to break key manifesto pledges, particularly regarding income tax, VAT, and National Insurance. Reeves stated, "We will all have to contribute" to address the financial challenges facing the country. She emphasised the need to protect families from high inflation and interest rates, while also ensuring that public services are safeguarded from austerity measures. During her 45-minute address, Reeves acknowledged the difficult economic landscape, citing global issues such as the tariff war initiated by former US President Donald Trump, as well as domestic challenges, including a downgrade in economic productivity. She remarked, "As Chancellor, I have to face the world as it is, not the world as I want it to be." The Chancellor's comments have raised questions about her commitment to Labour's manifesto, which promised not to raise the three major taxes. When asked if she was prepared to lose the next election by making unpopular choices, Reeves responded, "If you’re asking me what comes first, national interest or political expediency, it’s national interest every single time." Economists have suggested that Reeves may need to find billions to address a budget shortfall exacerbated by U-turns on welfare spending cuts and rising debt interest costs. She reiterated her commitment to fiscal rules and the necessity of bringing down national debt. Reeves also took aim at the previous government, criticising their austerity measures and the rushed Brexit deal, which she claimed had a detrimental impact on the economy. She stated, "The decision to pursue a policy of austerity after the financial crisis dealt a hammer blow to our economy." In her speech, Reeves highlighted the importance of making tough decisions for the future of the country, stating, "If we are to build the future of Britain together, we will all have to contribute to that effort." As the Budget approaches, public opinion is divided on whether Reeves should step down if she proceeds with tax increases that contradict Labour's election promises. An exclusive poll has been launched to gauge public sentiment on this issue. The Chancellor's remarks have set the stage for a contentious Budget announcement, with many awaiting clarity on her proposed policies and their implications for the UK economy.
Tax Hikes Loom as Chancellor Rachel Reeves Faces Backlash
Britain News9 hrs ago
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