Starmer warns that Brits face greater taxes FOREVER and he may elevate them AGAIN to prop up the NHS and public providers as a result of the Budget should confront ‘harsh fiscal actuality’

Keir Starmer today made clear there is no prospect of taxes coming down again after the looming Budget raid.  

The PM said the idea that governments can ‘lower taxes and that your public services will run properly’ had been exposed as a ‘fiction’.

Signalling a shift to a Scandinavian-style higher burden, Sir Keir argued in a speech that the country had voted for ‘change’. 

The comments came as the premier admitted there is ‘tough stuff’ coming in Chancellor Rachel Reeves‘ first fiscal package on Wednesday.

It is expected to bring in a massive £35billion a year extra for the Treasury – one of the biggest ever Budget tax raids.

Strikingly, Sir Keir refused to rule out the government coming back to milk more cash. 

Instead he appealed for voters to give Labour time to ‘rebuild the foundations’ despite the brutal assault on their pockets. 

In one specific announcement, the PM confirmed that the £2 cap on bus fares will rise to £3. There was also a hint that motorists might be spared the pain of at least some of a mooted 7p rise in fuel duty.

Critics have dismissed claims from ministers that ordinary ‘working people’ will not see the impact in payslips, because most of the pain will be initially targeted at businesses and the wealthier.

The Tories said it was clear Labour ‘wasn’t straight with the British people’ about their intentions before the election. 

A major increase to employers’ national insurance contributions looks set to be the centrepiece of the big post-election package.

There are also likely to be attacks on inheritance tax, capital gains and pension pots. 

The Labour election manifesto used the term ‘working people’ as it laid out who would be protected from increases. 

But Sir Keir sparked fury last week by suggesting landlords, shareholders and savers did not count.

Education Secretary Bridget Phillipson struggled yesterday on whether small business owners making just £13,000 a year were ‘working people’.

And the premier tried to avoid a definition entirely this morning, merely insisting ‘the working people of this country know exactly who they are’. 

In his speech, Sir Keir said: ‘We have to be realistic about where we are as a country. This is not 1997, when the economy was decent but public services were on their knees.

‘And it’s not 2010, where public services were strong, but the public finances were weak. These are unprecedented circumstances.

‘And that’s before we even get to the long-term challenges ignored for 14 years: an economy riddled with weakness on productivity and investment, a state that needs urgent modernisation to face down the challenge of a volatile world.’

The PM denied he is using the UK’s problems as ‘an excuse’, despite repeatedly putting the blame on the Tories.

‘Politics is always a choice. It’s time to choose a clear path, and embrace the harsh light of fiscal reality so we can come together behind a credible, long-term plan,’ he said.

Challenged that most voters would prefer lower taxes rather than investment in public services, the PM said: ‘No. I think for too long, we pretended that you could lower tax and spend more on your public services, but you can’t. And it’s about time we faced up to that.’

He added: ‘Almost everybody knows the NHS is broken. We’re going to fix it, put it back on his feet, and make it something we can be proud of again.

‘That’s the path we’re choosing, and that’s what we’ll deliver for working people.

‘But what we’re not going to do is continue the fiction that got us here in the first place, the pretence that you can always have lower taxes and that your public services will run properly.

‘Because the last 14 years have shown this is completely and utterly untrue, and people voted for change.’

The UK still has a lower tax to GDP burden than countries such as Sweden and France, but the level has spiked significantly since Covid.

Ms Reeves’ hikes are expected to take the ratio to a new high since records began in 1948. Although figures before that are not directly comparable, that appears to be the highest ever.   

Sir Keir said local services to ‘get Britain working’ will benefit from a £240million funding boost in the Budget.

He said: ‘Rebuilding Britain and delivering growth will take the skills and effort of all of us.

‘That’s why this Budget will also get Britain working. It will pave the way for reforms that tackle the root causes for economic inactivity and make sure that those who can work do work.

‘As a Labour Government, we will always help those who cannot support themselves, but the UK is the only G7 country for whom inactivity is still higher than it was before Covid.

‘And that’s not just bad for our economy, it’s also bad for all those who are locked out of opportunity.

‘So the Chancellor will announce £240 million in funding to provide local services that can help people back into work and the dignity that that brings.’

Shadow Treasury Chief Secretary Laura Trott said: ‘Rachel Reeves said during the election campaign that Labour’s plans ‘don’t require any further increases in taxes’ other than the tax rises set out in Labour’s manifesto. Keir Starmer confirmed today that this wasn’t true.

‘The Budget Labour are about to deliver is the one they planned all along and Labour simply weren’t straight with the British people about it during the election campaign.’

Earlier, Chancellor of the Duchy of Lancaster Pat McFadden told Times Radio that the Government ‘levelled with people’ before the Budget.

‘There’s no point in telling people everything’s absolutely fine when the prison system is in a state of collapse, when NHS waiting lists are at a record high, when we’ve got crumbling schools,’ he said.

‘There’s so much that’s wrong that we’ve got to fix and it’s important to set that out honestly and candidly for the public.’

He added: ‘I think we’ll have the most honest Budget on Wednesday that we’ve had for some years.’