UK budget 2024 live: Rachel Reeves’ expected tax hike will hit workers, says ex-Bank of England governor
Education secretary Bridget Phillipson has vowed no tax rises in payslips for ‘working people’
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Rachel Reeves’ tax-hiking Budget will hit workers however Labour frame it, the former governor of the Bank of England has said.
Lord Mervyn King, who was head of the Bank of England for a decade until 2013, said that the debate around who Labour are classifying as a “working person” is “a terrible illusion”.
Speaking on Sky’s Sunday Morning with Trevor Phillips, Lord King said: “Taxes are paid by people, they’re not paid by companies or institutions, ultimately, they fall on the amount that people can spend, and you only can raise significant amounts of money by raising taxes on most people, however you care to define that, but it’s most people will have to pay higher taxes.”
He added: “Ultimately, the impact of these higher taxes has to be on the consumption of most people, however you care to define that group.”
It comes after education secretary Bridget Phillipson pledged that working people would not see higher taxes on their payslips.
We’ll be bringing you all the latest updates ahead of the big event here, on The Independent’s liveblog.
Inheritance tax already up 10 per cent as Reeves looks to squeeze levy in Budget, official figures show
Brits are already paying 10 per cent more on inheritance tax before Reeves’ budget
Chancellor warned that hiking the tax at next week’s Budget risks punishing middle-class homeowners
Wes Streeting warned inflation-busting NHS Budget deal will not be enough
Wes Streeting warned inflation busting NHS Budget deal will not be enough
Health experts urge the government to find more money to tackle waiting lists and improve NHS care
Air Passenger Duty may go up in Reeves’s Budget – could the ‘Inverness Immunity’ come to an end?
Air Passenger Duty may rise in Reeves’s Budget – could the ‘Inverness Immunity’ end?
Plane Talk: Why it’s not always a good idea to tax the traveller until the pips squeak
Tax on high earners ruled out as Rachel Reeves looks to plug £40bn Budget black hole
Tax on high earners ruled out as Rachel Reeves looks to plug £40bn Budget black hole
No 10 forced into astonishing admission that high earners can also be protected by its pledge not to raise national insurance for working people – after minister refused six times to confirm if that included employees on six-figure salaries
UK economy to grow faster than thought in pre-Budget boost for Reeves
Inheritance tax already up 10 per cent as Reeves looks to squeeze levy in Budget
Britons are already paying more inheritance tax as Rachel Reeves looks to squeeze millions more from the levy, official figures show.
Payments swelled the Treasury’s coffers by £4.3bn in the six months since April, £400m more than in the same period in the previous financial year and a rise of 10 per cent, new data from HM Revenue and Customs shows.
Brits are already paying 10 per cent more on inheritance tax before Reeves’ budget
Chancellor warned that hiking the tax at next week’s Budget risks punishing middle-class homeowners
Borrowing figures show “scale of public finances challenges” says expert
Government spending so far this financial year was £11.5 billion more than forecast by the OBR, points out The Resolution Foundation, which tallies with Rachel Reeves’ claim of a £22 billion “black hole” in the public finances.
The foundation’s senior economist Cara Pacitti said: “Six months into the financial year, Britain is borrowing £6.7 billion more than expected at the time of the Budget in March.
“This reflects central government spending which is £11.5 billion higher than anticipated, largely due to public sector pay rises and higher running costs.
“Today’s data highlights the scale of the public finances challenges facing the Chancellor as she grapples with overspending today, the need to avoid austerity in the future, and having to fund extra public service spending through tax rises.”
GDP due to grow in 2024 in major uplift, says IMF
The IMF has said UK gross domestic product (GDP) is due to grow by 1.1 per cent in 2024 - a major uplift from the 0.7 per cent growth forecast from July.
The UK economy is then expected to grow by 1.5 per cent in 2025, with the IMF maintaining its prediction from earlier in the year.
The IMF report also found that UK inflation for 2024 is set to be slightly higher than expected at 2.6 per cent, having previously pointed towards a 2.5 per cent reading.
It likewise slightly increased its inflation projection for 2025 to 2.1per cent from 2per cent in its previous outlook.
Unemployment is also set to be slightly worse than previously expected by the IMF, according to the latest report.
It said the UK unemployment rate is set to have been 4.3per cent for 2024 as a whole, compared with a previous 4.2per cent estimate.
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