BREAKING: Rachel Reeves refuses to rule out manifesto-breaking Autumn Budget tax hikes
Chancellor Rachel Reeves has refused to stand by Labour’s election vow not to hike income tax, VAT or national insurance at the Budget.
It came as Ms Reeves used a rare pre-Budget speech to say “each must do our bit” to build the Britain of a future and “contribute to that effort”. Appearing to lay the ground for tax hikes on November 26, Ms Reeves said she will “not always do what is popular – but do what is right”.
She told the public from Downing Street: “As I take my decisions on both tax and spend, I will do what is necessary to protect families from high inflation and interest rates, to protect our public services from a return to austerity and to ensure that the economy that we hand down to future generations is secure with debt under control.
“If we are to build the future of Britain together, we will all have to contribute to that effort. Each of us must do our bit for the security of our country and the brightness of its future.
But the Chancellor said she will make the “choices necessary” including protecting the NHS and reducing the cost of living for struggling Brits. Asked about Labour’s election vow – not to increase taxes on working people, including income tax, VAT and national insurance – Ms Reeves replies: “I will set out the individual policies at the Budget on 26 November, that is not what today is about.”
She added: “As Chancellor I have to face the world as it is, not the world as I want it to be. And when challenges come our way, the only question is how to respond to them, not whether to respond or not. ”
During the speech before the markets opened, Ms Reeves said the Tories’ austerity slashing programme had dealt a “hammer blow” to the country alongside a “rushed and ill-conceived Brexit“. She said it was her job to be “honest about the consequences those choices have had” and to get inflation falling in the coming months.
“Those who continue to push for easy answers are irresponsible now,” she added.
The Chancellor said since her maiden Budget last year the world has become more volatile with the cost of government borrowing spiking. Ms Reeves added: “The truth is that previous governments have not adequately faced up to these challenges.
“Too often, political convenience has been prioritised over economic imperative. The decision to pursue a policy of austerity after the financial crisis dealt a hammer blow to our economy, gutting our public services and severing the flows of investment that would have put our country on a path to recovery.
“The years that followed were characterised by instability and indecision, with crucial capital investment continually sacrificed, and hard decisions put off again and again.
“And then a rushed and ill-conceived Brexit that brought further disruption as businesses trying to trade were faced with extra costs and extra paperwork.”
