Rachel Reeves going through resignation calls as she’s ‘contemplating mountaineering earnings tax’
Doom-and-gloom chancellor Rachel Reeves is facing resignation calls after it emerged she is considering breaking Labour’s manifesto by hiking income tax.
Doom-and-gloom chancellor Rachel Reeves is facing resignation calls after it emerged she is considering breaking Labour’s manifesto by hiking income tax. She’s said to be in “active talks” to slam Brits with a string of tax raids to fill a £30billion “black hole” in the public finances next month.
Her plans apparently include raising income tax by slapping 1p on the basic rate – a move that could rake in more than £8billion. She could also be looking at increasing higher or additional tax rates to generate an estimated extra £2.2billion.
One of her army of critics wrote on X: “The £30billion black hole comes from her own borrowing and inflation-fuelled policies. Labour’s manifesto was built on lies – and now workers will pay the price. She needs to go.”
The Treasury is thought to be convinced raising income tax is the only option for the chancellor to raise enough cash to block her from more cash grabs for the rest of the current Parliament. A source said: “There is a very live debate going on right now among those planning the budget about how bold we want to be on the headroom.
“No one wants it to be £10billion again but there is an argument we go much higher, which will mean we don’t have to come back and do this again and might have space to cut taxes before the budget. If we go down that route however, it makes it more likely that we have to raise income tax – that is the discussion that is going on at the moment.”
Another insider added: “Rachel is understandably nervous but there is a big desire for additional headroom. But we need a stronger argument about our purpose if we are going to make the case.”
And a third source said: “The politics is bad either way. What matters, I think, is doing the right thing.”
Mrs Reeves is also plotting to raise more billions by hiking national insurance for doctors, lawyers and accountants who are employed through partnerships. She has also been urged to hit holidaymakers by imposing green taxes on flights.
A Treasury spokesperson said: “We do not comment on speculation around changes to tax.”
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