Chancellor Rachel Reeves Acknowledges Tax Increase Error

Chancellor Rachel Reeves has admitted she was incorrect in claiming during the election campaign that higher taxes were unnecessary, attributing the need for tax hikes to a 'black hole' in public finances that was concealed by the previous government. The recent budget has introduced a £40 billion tax increase, marking the largest rise since 1993, primarily affecting businesses through higher national insurance contributions. Reeves, who was unaware of the financial deficit upon taking office, has faced criticism for the tax rise but defended it as necessary to restore fiscal stability. She accused the former administration of misleading both Parliament and the Office for Budget Responsibility (OBR) about the true state of the economy. The tax changes will require businesses to either improve efficiency, reduce profits, or lower wage growth, with the OBR noting that the burden may shift to workers and consumers. Despite the backlash, Reeves maintains that the measures are essential for economic recovery.