Pressure on Reeves Over UK Tax Policy

Chancellor Rachel Reeves is facing pressure to raise taxes in the upcoming Autumn Budget amid deteriorating economic forecasts and a commitment to maintain fiscal rules with limited headroom. The Institute for Fiscal Studies warns that potential tax hikes could include increases in capital gains tax and the introduction of a wealth tax, sparking speculation and economic uncertainty. The Office for Budget Responsibility has forecasted a historic tax burden, rising from 35.3% of GDP in 2024/25 to 37.7% in 2027/28, driven by factors such as frozen income tax thresholds and rising national insurance contributions. Despite this, Reeves has ruled out further tax hikes for now, focusing on economic growth through planning and regulatory reforms. The prospect of further spending cuts or tax hikes looms as growth forecasts have been slashed, with GDP expected to grow only 1% this year. The Chancellor's strategies have been criticized in the media, with concerns over the impact on the economy and public services.