Budget 2025: Rachel Reeves signals tax rises and warns ‘each of us must do our bit’
Reeves looks set to break key Labour manifesto pledge
- Chancellor Rachel Reeves warned that "we will all have to contribute" to fixing Britain's public finances, signalling potential tax rises in her upcoming Budget.
- Reeves indicated a readiness to break Labour's manifesto pledge against raising income tax, personal national insurance, or VAT, stating "each of us must do our bit."
- She attributed the need for "hard choices" to global issues, including a tariff war and downgraded economic forecasts, as she grapples with a public finance black hole of up to £50bn.
- Former Treasury minister Jim O’Neill cautioned that income tax increases alone might not suffice, urging broader reforms such as property tax changes and welfare reform.
- The Office for Budget Responsibility is expected to significantly downgrade productivity forecasts, further complicating the financial outlook, with Reeves aiming for a larger fiscal buffer.