UK Deputy PM Angela Rayner Proposes Tax Hikes to Chancellor Rachel Reeves

Angela Rayner, the Deputy Prime Minister, has caused significant tensions within the Labour Party by advocating for multiple tax increases targeting savers, high earners, and pensioners, as revealed in a secret memo sent to Chancellor Rachel Reeves. The memo proposed reinstating the pensions lifetime allowance, freezing the additional rate income tax threshold, increasing dividend taxes, ending inheritance tax relief on shares in the Alternative Investment Market, and raising the bank surcharge to generate an estimated £3 billion to £4 billion annually. These proposals have sparked internal disputes, with Rayner reportedly pushing back against spending cuts and expressing frustration over defending such cuts. While Rayner's allies emphasize the popularity and prudence of the tax increases, Chancellor Reeves maintains control over tax and spending policy and has so far resisted tax hikes. The pension tax proposals, particularly the reinstatement of the lifetime allowance, have raised concerns among public sector workers, including NHS doctors, about potential financial losses and early retirement risks. This ongoing debate underscores deep divisions within Labour's leadership on balancing tax increases and spending decisions ahead of upcoming budget considerations.