Keir Starmer opens door to Budget tax raid after inflation unexpectedly jumps to 3.6 per cent
TAXING TIMES Keir Starmer opens door to Budget tax raid after inflation unexpectedly jumps to 3.6 per cent
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SAVERS were last night bracing themselves to be hit in the pocket as Sir Keir Starmer appeared to open the door to a Budget tax raid.
The Prime Minister indicated they could be hit when pushed on how he would define a working person - with the Labour manifesto promising to protect them.
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The Labour manifesto promised to protect working people from tax hikes, pictured Chancellor Rachel Reeves who is attempting to balance the books
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It comes as inflation unexpectedly rose to 3.6 per cent for June with petrol and food costs seen as driving factors.
Ministers in recent days have struggled to say who would escape tax hikes but Transport Secretary Heidi Alexander at the weekend said people on 'modest incomes' would be safe from hikes.
The PM, when asked what to explain a modest incomes, said: 'I think of the working people across this country who put in every day and don't get back what they deserve.
'That is who we are working for… the sort of people that work hard but haven't necessarily got the savings to buy themselves out of problems.'
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TAXING TIMES Wetherspoons boss blasts Rachel Reeves' tax raid, warning more pubs will shut
Tory leader Kemi Badenoch said high taxes brought in such as the national insurance hike was the reason why the economy had shrunk.
Sir Keir said that his government was 'only just getting started' as he was pushed about decisions at the Budget this autumn.
Meanwhile, households could see the brakes put on interest rate cuts after inflation hit its highest rate for 18 months.
Petrol and food costs drove the unexpected hike to 3.6 per cent in June, up from 3.4 per cent the previous month, giving Bank of England chiefs a headache in turning around the sluggish economy.
Businesses and shops also pushed up prices after the £25 billion national insurance tax raid and the minimum wage hike came in from April.
Suren Thiru, of the Institute of Chartered Accountants in England and Wales, expects bank bosses to make a cut next month from 4.25 per cent.
Raising taxes will kill off growth, Reeves warned as she pledges to rip up business red tape
But she added that 'given mounting worries over economic conditions, these figures may increase caution over the pace of future rate cuts'.
The bank's target rate is 2 per cent.
The figures will pile more pressure on Chancellor Rachel Reeves as she attempts to balance the books amid global uncertainty of Donald Trump's global tariffs.
One area of concern is core inflation - which excludes energy and food costs - went up from 3.5 to 3.7 per cent in May, the Office of National Statistics said.
Ms Reeves said: 'I know working people are still struggling with the cost of living.'
She added that she would deliver to 'put more money into people's pockets'.
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