In a significant pre-Budget address today, Rachel Reeves pledged to safeguard the NHS and enhance the cost of living for struggling individuals in the UK. Facing a financial gap of £20 billion to £30 billion in public finances, the Chancellor affirmed her commitment to making necessary decisions, hinting at potential tax increases in the upcoming Budget.
During a press briefing at No. 9 in Westminster, Ms. Reeves emphasized the crucial decisions required to address NHS waiting lists and national debt, attributing the challenges to the previous administration. One proposal under consideration involves reducing the VAT rate on electricity and gas, which could potentially save households an average of £86 annually.
In response to the speech, Carsten Jung, associate director for economic policy at IPPR, supported the need for tax adjustments in a fair and growth-oriented manner. Highlighting the importance of reforming the tax system to ensure equitable contributions, Jung stressed the significance of generating revenue to tackle rising living costs.
Ahead of her Budget presentation on November 26, Ms. Reeves hinted at forthcoming tax hikes, urging collective effort to secure the country’s economic future. Refraining from recommitting to Labour’s pledge on tax policies, she underscored the need for all citizens to contribute in light of global challenges and internal economic constraints.
Acknowledging the necessity of fiscal prudence, the Chancellor emphasized the unwavering commitment to fiscal rules and responsible decision-making. Despite the looming tax adjustments, Ms. Reeves assured that efforts would be made to protect families, public services, and the economy for future generations.