Rachel Reeves looking at ‘lots of little tax rises' in Budget as she is under pressure to lift 2 child benefit cap

Scottish Sun

24-05-2025

Senior Labour MP Meg Hillier said that lifting the cap is the most efficient way to lift kids out of child poverty
TAXING TIMES Rachel Reeves looking at 'lots of little tax rises' in Budget as she is under pressure to lift 2 child benefit cap
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RACHEL Reeves is looking at 'lots of little tax rises' in the Budget as she is under massive pressure to find billions to lift the 2 child benefit cap.
Treasury officials have been drawing up a suite of possible levies which the Chancellor could whack on Brits in her fiscal blueprint later this year.
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Senior Labour MP Meg Hillier became the latest to back lifting the cap
One Whitehall official said options included creating another council tax ban - known as a mansion tax.
Although Treasury ministers have previously played down the prospect of this policy.
A Treasury source said: 'They are looking at lots of little tax rises.'
Ms Reeves is under huge pressure from Labour figures - including Gordon Brown - to lift the 2 child benefit cap, which limits the full benefits parents can get to two children.
Sir Keir Starmer is looking at lifting the cap after a revolt from his MPs - but it would cost around £3 billion a year.
With Treasury coffers running low, No11 is expected to have to raise taxes to pay for the benefit.
Senior Labour MP Meg Hillier, chairwoman of the powerful Treasury select committee, became the latest to come out backing lifting the cap.
She told the BBC that it's the most efficient way to lift kids out of child poverty.
She said: 'The only way we will lift children out of poverty in those households is to get that money to them.
'No Labour MP wants child poverty to go up by the end of the parliament.'
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Dame Meg has researched the topic and believes that scrapping the two-child limit in April 2025 would immediately pull 350,000 children out of poverty and stop another 150,000 being drawn into poverty over this parliament.
A Treasury spokesman said: 'The best way to strengthen public finances is by growing the economy – which is our focus.
'Changes to tax and spend policy are not the only ways of doing this, as seen with our planning reforms which are expected to grow the economy by £6.8bn and cut borrowing by £3.4bn.
'We are committed to keeping taxes for working people as low as possible which is why at last Autumn's Budget we protected working people's payslips and kept our promise to not raise the basic, higher or additional rates of Income Tax, employee National Insurance or VAT.'