Rachel Reeves admits her tax-hiking Budget is ‘not going to be easy’ but insists it will ‘kickstart’ growth
Date: 2024-10-27RACHEL Reeves today admits her tax-hiking Budget is “not going to be easy†– but will be worth it to “kickstart†the economy.
Levelling with the country, the Chancellor said she has been forced to make “tough decisions†to whack up levies.
The cash will be ploughed into fixing Britain’s crumbling hospitals, schools and roads, she vowed.
Labour’s Halloween Budget will hike taxes by around £35 billion.
This includes a whopping £20 billion rise in employer National Insurance Contributions – dubbed a “jobs taxâ€.
Writing exclusively for the Sun on Sunday, Ms Reeves said: “I have had to make tough decisions in this Budget.
“Not everything is going to be easy.
“But let me be clear – I am doing this for hardworking families up and down the country who have been crying out for change.
“It is a Budget for the strivers.â€
In her frankest comments yet, she declared: “I will take the tough – but fair – decisions on tax.â€
Labour’s first Budget in a generation is expected to:
• Massively hike employer NICs – but plans for a pensions tax raid ditched
• Increase capital gains tax on shares and close inheritance tax loopholes
• Extend income tax freeze so Brits pay more on their earnings
•The 15-year freeze in fuel duty hangs in the balance
• Tear up fiscal rules so Labour can go on a £20bn borrowing binge
• Schools budget is protected and £1.4 billion given to rebuild classrooms
• Pump billions into the NHS to boost technology and build 40 new hospitals
The tax and spending plans will “ensure Britain’s working people are better offâ€, Ms Reeves pledged.
Yesterday, Sir Keir Starmer was forced to deny he misled Britain during the election over his secret tax plans.
The PM also denied “waging war†on middle England.
Labour promised not to increase taxes on “working people†– including NICs and income tax.
They now insist this refers only to employee NICs and income rates.
Asked at a press conference in Samoa yesterday if he “misled†Brits, the PM said: “No.
“We were really clear in the manifesto about and in the campaign that we wouldn’t be increasing taxes on working people and spelt out what we meant by that in terms of income tax, in terms of NICs and in terms of VAT.
“And we intend to keep the promises that we made in our manifesto.â€
Rachel Reeves is the first woman to ever deliver a UK Budget - so meet the Beyonce superfan and chess whizz making history, By KATE FERGUSON
THERE have been Chancellors for nearly 1,000 years - but Rachel Reeves will make history this week by becoming the first woman to deliver Britain’s Budget.
She will join Sir Winston Churchill, William Gladstone and Thomas Cromwell in the pantheon of political giants who have held the nation’s finances in their hands.
It was not that long ago when Labour openly laughed at the idea of having a female Chancellor.
The bushy eyebrowed ex Chancellor Dennis Healey told a newspaper in 1997: “Being Chancellor is not a woman’s job.
“There’s a difference between the sexes, and people who don’t know that don’t know what people are like with their clothes off. So there.â€
But if running the economy was man’s work, Mr Healey made a right pig’s ear of it.
He was Chancellor when Britain went bust in 1976 and had to go cap in hand to the IMF for a giant bailout.
It was a moment of national humiliation that shredded Labour’s economic credibility for decades.
Rachel, 45, grew up in Lewisham in south London and attended her local comprehensive school. Her mum and dad were both teachers.
A chess whizz kid, she sailed through school and studied PPE at Oxford University before working at the Bank of England.
Famously branded “boring snoring†by BBC Newsnight editor Ian Katz, Rachel has worked hard to change her image.
She swapped bodycon dresses for sharp work suits, got a bob and dubbed herself the Iron Chancellor in a deliberate nod to Margaret Thatcher.
Image matters in politics.
Earlier this month, Rachel set tongues wagging when she dyed her chestnut hair red.
Westminster insiders thought she was trying to send a message.
Was she softening her image after being accused of being too gloomy about the nation’s finances? Or doubling down as Britain’s ‘red’ Labour Chancellor?
The Sun on Sunday can reveal the truth is a little duller – but one many women can relate to.
She had only wanted a slight tweak to her colour, and when the hairdresser washed off the dye to reveal the newly ginger locks Rachel immediately did not like it.
“It was a mistakeâ€, one pal said.
A huge Beyonce fan, Rachel has been in training for her big Budget day by plugging in her airpods and hitting the streets on early morning runs.
Over the years Britain has had some real hellraising Chancellors.
Thomas Cromwell would stop at nothing to find money for his master King Henry VIII.
Those who opposed his decision to dissolve the monasteries and hand the plunder to the King would find themselves at the Tower of London or worse – the scaffold.
The aristocrat Francis Dashwood – a notorious libertine and heavy drinker – became Chancellor in 1780.
But he was ousted within a year after putting taxes up on cider sparking fury among Britain’s booze loving folk.
A lesson perhaps for Rachel as she decides whether to raise alcohol duty or not.
Coincidentally, Budget Day is the only day of the year when Parliament’s strict no-booze rules are ripped up and the Chancellor is allowed to have a tipple.
Ken Clarke was the last Chancellor to enjoy this rule – sipping on a whisky at the Despatch Box.
Benjamin Disraeli opted for a brandy and water, Gladstone had a sherry with a beaten egg in it, while Geoffrey Howe had a Gin & Tonic.
Rachel will go for plain old water on Wednesday.
But while her choice of drink may be dull there will be nothing boring snoring about her Budget.
She will drop a tax bomb on Britain, tear up fiscal rules to go on a borrowing binge to bankroll big building projects.
It is a seismic shift in politics and a huge gamble from Britain’s first Labour Chancellor in a generation.
Gulp.
