|
Reeves refuses to rule out tax rises after economy shrinks
[BBC] Chancellor Rachel Reeves has refused to rule out future tax rises after the UK economy suffered its worst contraction for a year and a half in April.The economy unexpectedly shrank by 0.3% after taxes increased for businesses, household bills jumped and exports to the US plunged. The figures come a day after Reeves set out spending plans aimed at boosting growth, with funding increases for the NHS and defence, but budgets squeezed elsewhere. Economists warned that a failure to increase UK growth would "almost certainly" lead to more tax rises later this year for the government to balance its spending commitments. Reeves acknowledged the latest economic figures were "clearly disappointing" and refused to rule out tax rises when she next lays out her plans for the economy in the autumn Budget. "No chancellor is able to write another four years of Budgets within a first year of government, you know how much uncertainty there is in the world at the moment," she told the BBC. Monthly figures on the economy are volatile, and the more stable three-month figure to April showed the economy grew by 0.7%. "With spending plans set... any move in the wrong direction will almost certainly spark more tax rises," said Paul Johnson, director of the Institute for Fiscal Studies (IFS), an influential think tank. Ruth Curtice, chief executive of the Resolution Foundation, agreed. "A weaker economic outlook and the unfunded changes to winter fuel payments mean the chancellor will likely need to look again at tax rises in the Autumn," she said. In Wednesday's Spending Review, Reeves prioritised ploughing billions into long-term projects, in a bid to boost economic growth and improve living standards. Posted by: Skidmark 2025-06-14 |
| http://www.rantburg.com/poparticle.php?ID=765535 |