UK Chancellor Reeves Signals Autumn Tax Rise After £5bn Welfare U-Turn

Chancellor Rachel Reeves faces mounting pressure to raise taxes significantly in the upcoming Autumn Budget following a series of government U-turns on welfare reforms, which have created a £5 billion shortfall in public finances. The Labour Government was forced to abandon stricter eligibility rules for Personal Independence Payment (PIP) benefits after a backbench rebellion, a move that Reeves described as "damaging" and costly. Financial analysts warn that tax increases could reach up to £40 billion to cover additional spending commitments and economic uncertainties, with Deutsche Bank suggesting £10-15 billion in tax hikes as a minimum. Despite a difficult week marked by intense scrutiny and emotional moments in Parliament, including Reeves shedding tears during Prime Minister’s Questions, she insists she has no intention of resigning and remains committed to balancing the public finances while protecting priorities such as healthcare and support for working people. The public and political responses to Reeves' visible distress have been mixed, with some expressing sympathy and others criticizing the emotional display amid ongoing political turmoil. The government is now conducting a review of the welfare cuts' impact, led by Work and Pensions Minister Sir Stephen Timms, as it navigates the challenges posed by internal party dissent and fiscal constraints.