This week, Rachel Reeves will deliver Labour’s first Budget in 15 years. As speculation mounts over how the Chancellor intends on filling the £22billion black hole she claims to have inherited from the Tories, we ask – would you be happy to pay more tax?
Ms Reeves has said that there will be ‘difficult choices’ on spending, welfare and tax. However, she promised the country there will be ‘no return to austerity’, leading to some nervousness at the top of government over spending plans for Whitehall departments.
While Prime Minister Keir Starmer has reassured that working people’s taxes will not be raised, a recent poll for Tax Justice by Survation revealed that almost three quarters of MPs would like to see taxes increase to boost crumbling public services. The poll also revealed that nine in ten (91%) Labour MPs are in favour of the measure.
Sarah Hall, the deputy director at Tax Justice UK, said: “We have a government – and Parliament – that are overwhelmingly in favour of higher taxes to fix public services which have been left to run down over the last decade.
“Voters backed the government under a slogan of change, now it has a perfect opportunity to deliver in confidence. Taxing those with the broadest shoulders more will allow for investment that returns benefits for everyone and delivers a stronger, more resilient economy.”
If you can’t see the poll, click here.
During the Election, the Labour Party’s manifesto stated: “We will not increase National Insurance, the basic, higher or additional rates of Income Tax, or VAT”. Since then, Keir Starmer has insisted the Government will “keep our manifesto pledges”. However, it has been reported that Reeves is looking into several options to plug the £22billion black hole in day-to-day spending.
The Chancellor is considering extending the freeze on income tax – first introduced by the Conservatives – which could push more people into paying higher rates. Starmer has also given a strong signal that the Government could hike national insurance for employers.
Ms Reeves is also expected to announce the end of the temporary 5p cut in fuel duty next year, which was introduced during the war in Ukraine. Vaping products could also see their tax hiked, in an attempt to cut the soaring numbers of children picking up the habit. Spending on overseas aid is also expected to be cut.
Inheritance tax, which currently stands at a 40% rate, could possibly rise as well, alongside capital gains tax – which is levied on the sale of assets which have increased in value over time.
In response to rumours surrounding the Budget, Mirror readers were split over the Chancellor’s plans. Kemper said: “It’s been clear from before the election which areas would be in line for tax rises, when Labour ruled out 3 personal taxes.
“Some of those allow individuals to pay a lower rate of tax than working people, so probably due a rise.”
While Hawkster1 wrote: “Out of the past 45 years Labour have been in power for only 13 years so the blame lies with the Tories — under Labour public services did improve and NHS was in a good state — look at it now”
However, in opposition, okjoe said: “I will tell you what this will cost, jobs will go, landlords will go, businesses will go, investors will go, small businesses will go, entrepreneurs will go.”
What do you think? Would you be happy to pay more tax? Take our poll and have your say in the comments.