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Daily Mirror
2 days ago
- Business
- Daily Mirror
Chancellor Rachel Reeves confronted over Budget tax rises as new figures released
Chancellor Rachel Reeves declined to be drawn on any tax hikes ahead of the autumn Budget amid reports officials are looking at changes to inheritance taxes Rachel Reeves has insisted she wanted to "get our economy firing off all cylinders" - but declined to be drawn on any Budget tax raise. The Chancellor's comments came as new GDP figures showed the economy grew by 0.3% in the three months to June. While the number fell short of the 0.7% recorded in the first three months of 2025 it was stronger than the 0.1% widely expected by economists. Responding on Thursday, Ms Reeves said "the economy beat expectations in the second quarter of this year". But speaking at a construction site in Doncaster, the Chancellor said "there's still more to do to make sure that people in all parts of the country benefit" from growth. She added: "My number one priority as Chancellor, to get our economy firing off all cylinders so that working people in all parts of the country will feel the benefits of that economic growth." It comes after the Chancellor gave an update on wealth tax calls as pressure mounts to target richest Brits. Quizzed on whether taxes will have to increase in the autumn, Ms Reeves told reporters: "We'll wait for the official forecast from the Office of Budget Responsibility, and we'll make those decisions in the round." Earlier this week it was reported the Chancellor is looking at changes to inheritance tax in an attempt to plug a hole in the public finances. Officials are said to be examining whether to tighten rules around the gifting of money and assets before someone dies. But no decisions have been made. Ms Reeves added: "Any decision around taxation is a ... decision for the Budget, and I'll make those announcements. We haven't even set the date yet for the Budget, but the key focus of the Budget is going to be to build on numbers that we've seen today to boost productivity and growth and prosperity all across the country." ONS director of economic statistics Liz McKeown said: "Growth slowed in the second quarter after a strong start to the year. The economy was weak across April and May, with some activity having been brought forward to February and March ahead of stamp duty and tariff changes, but then recovered strongly in June. "Across the second quarter as a whole, growth was led by services, with computer programming, health and vehicle leasing growing." Responding to reports of an inheritance tax change yesterday, a Treasury spokesperson 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 not to raise the basic, higher or additional rates of income tax, employee national insurance or VAT."
Glasgow Times
2 days ago
- Business
- Glasgow Times
Reeves says rulings on tax must wait for Budget amid inheritance tax speculation
The Chancellor told reporters that decisions will be made 'in the round' and her priority 'is to get our economy firing off all cylinders'. Earlier this week, the Guardian reported that officials are examining whether tightening rules around the gifting of assets and money could help address the UK's multi-billion-pound fiscal shortfall. Government U-turns over winter fuel payments and welfare reform have left Chancellor Rachel Reeves with a multibillion-pound spending gap to about the reports on Thursday, Ms Reeves said: 'Any decision around taxation is a … decision for the Budget, and I'll make those announcements. 'We haven't even set the date yet for the Budget, but the key focus of the Budget is going to be to build on numbers that we've seen today to boost productivity and growth and prosperity all across the country. 'That is my number one priority as Chancellor, to get our economy firing off all cylinders so that working people in all parts of the country will feel the benefits of that economic growth.' Pushed on whether taxes will have to increase in the autumn, Ms Reeves added: 'We'll wait for the official forecast from the Office of Budget Responsibility, and we'll make those decisions in the round.' Chancellor of the Exchequer Rachel Reeves said decisions on taxes, including inheritance tax, will have to wait for the autumn Budget (Matthew Hornwood/PA) Among the reported inheritance tax measures under consideration is a potential cap on lifetime gifts, part of a broader review into how assets can be transferred before death to minimise inheritance tax liabilities. Under current UK rules, gifts made more than seven years before a person's death are exempt from inheritance tax. Gifts made between three and seven years prior are taxed on a sliding scale, depending on their value and the total estate. The Chancellor was speaking as new official figures show that the UK economy slowed in the second quarter of this year amid pressure from tariff uncertainty and tax increases. The Office for National Statistics (ONS) said gross domestic product (GDP) grew by 0.3% for the quarter after 0.7% growth in the first three months of the year. However, the figure was stronger than the 0.1% level widely expected by economists after an uptick in activity in June and revised data for earlier in the quarter.
Western Telegraph
3 days ago
- Business
- Western Telegraph
Reeves says rulings on tax must wait for Budget amid inheritance tax speculation
The Chancellor told reporters that decisions will be made 'in the round' and her priority 'is to get our economy firing off all cylinders'. Earlier this week, the Guardian reported that officials are examining whether tightening rules around the gifting of assets and money could help address the UK's multi-billion-pound fiscal shortfall. Government U-turns over winter fuel payments and welfare reform have left Chancellor Rachel Reeves with a multibillion-pound spending gap to about the reports on Thursday, Ms Reeves said: 'Any decision around taxation is a … decision for the Budget, and I'll make those announcements. 'We haven't even set the date yet for the Budget, but the key focus of the Budget is going to be to build on numbers that we've seen today to boost productivity and growth and prosperity all across the country. 'That is my number one priority as Chancellor, to get our economy firing off all cylinders so that working people in all parts of the country will feel the benefits of that economic growth.' Pushed on whether taxes will have to increase in the autumn, Ms Reeves added: 'We'll wait for the official forecast from the Office of Budget Responsibility, and we'll make those decisions in the round.' Chancellor of the Exchequer Rachel Reeves said decisions on taxes, including inheritance tax, will have to wait for the autumn Budget (Matthew Hornwood/PA) Among the reported inheritance tax measures under consideration is a potential cap on lifetime gifts, part of a broader review into how assets can be transferred before death to minimise inheritance tax liabilities. Under current UK rules, gifts made more than seven years before a person's death are exempt from inheritance tax. Gifts made between three and seven years prior are taxed on a sliding scale, depending on their value and the total estate. The Chancellor was speaking as new official figures show that the UK economy slowed in the second quarter of this year amid pressure from tariff uncertainty and tax increases. The Office for National Statistics (ONS) said gross domestic product (GDP) grew by 0.3% for the quarter after 0.7% growth in the first three months of the year. However, the figure was stronger than the 0.1% level widely expected by economists after an uptick in activity in June and revised data for earlier in the quarter.
The Guardian
14-04-2025
- Politics
- The Guardian
‘Electoral wake-up call': dozens of Labour MPs risk losing majorities over welfare cuts
At least 80 Labour MPs are at risk of losing their majorities over proposed welfare cuts, according to data shared between Labour MPs who are warning the government that the changes 'pose a real electoral risk'. The analysis suggests almost 200 Labour MPs have a majority smaller than the number of recipients of personal independent payments in their constituencies – a significant number in northern England 'red wall' seats. Not all of those recipients will be affected by the changes – but more than 80 Labour MPs have a majority which is smaller than the number of disabled people who could see their benefits cuts. MPs say an organising campaign to oppose welfare changes is stepping up coordinated action over the Easter recess, with a vote now expected in June. Rebels believe they may be able to secure as many as 50 MPs to vote against the changes. One MP who opposes the changes said party whips had been suggesting some uneasy MPs may be quietly allowed to abstain on the vote. A number of disaffected but loyalist MPs who do not want to rebel have been encouraging a campaign of personal letter-writing directly to Keir Starmer to urge changes to the cuts or pledges of more action to tackle poverty in advance of the vote, saying it was 'pointless' to lobby the chancellor, Rachel Reeves. More hardline MPs are planning a mass public intervention in the weeks after parliament returns, the Guardian has been told. The Office of Budget Responsibility has suggested about 52% of current claimants do not score high enough on their current assessment to remain eligible for Pip, though many would be likely to challenge the reassessment. Cabinet and senior ministers are among those who have smaller majorities than the number of constituents expected to be affected by the changes. They include the justice secretary, Shabana Mahmood, and health secretary, Wes Streeting, as well as the safeguarding minister, Jess Phillips, education minister, Nia Griffith, and homelessness minister, Rushanara Ali. The list also includes high-profile MPs who are vulnerable to Reform, such as the Barnsley South MP, Stephanie Peacock, Rotherham MP, Sarah Champion, Kingston upon Hull East MP, Karl Turner, and Grimsby MP, Melanie Onn. Some MPs with healthy majorities could be at risk, the data shows. In Easington, where Grahame Morris has a majority of more than 6,000 over Reform, there are more than 12,600 Pip claimants. In Huddersfield, Harpreet Uppal has a majority of more than 4,500 over the Greens, but 9,387 Pip claimants. MPs are also warning that family members of claimants are also likely to be affected significantly or feel very strongly about the cuts – meaning the ripple effect could be much greater. The data also shows the sheer numbers of voters in Labour constituencies – even with large majorities – where people receive Pip. In some Labour constituencies, including Easington, Blaenau Gwent and Aberfan, one in five of the working-age population receive Pip payments. In the Swansea West seat of the pensions minister, Torsten Bell, one in six people receive Pip. In Pat McFadden's Wolverhampton seat, it is about one in seven, similar to the seat of the education secretary, Bridget Phillipson, in Houghton and Sunderland South. Sign up to First Edition Our morning email breaks down the key stories of the day, telling you what's happening and why it matters after newsletter promotion The proposals will introduce strict higher bars to accessing disability support to those in and out of work, as well as cut the higher rate of universal credit (UC) which applies to those who are too disabled to work. The data has been disseminated among Labour MPs including by Andy McDonald, the former shadow employment minister. He said: 'The government's welfare reforms disproportionately hit constituents who can least afford it and that is particularly so in the constituencies of many Labour MPs. It poses a real electoral risk. 'We know people on low incomes spend the money they take home in their local communities, so this policy is sucking money out of our local towns. The government should prioritise its anti-poverty strategy before rushing decisions to reform welfare which harm those in need.' Neil Duncan-Jordan, the Labour MP for Poole, said it was clear the cuts would have an electoral impact. 'It is quite clear from the recent polling by the Joseph Rowntree Foundation that the majority of people who voted Labour in 2024 believe the proposed changes to disability benefits are wrong. 'It's not only morally wrong to target the poor, it's also electorally foolish. The government needs to withdraw the green paper and go back to the drawing board.' The MP Richard Burgon said he hoped the data would raise alarm among Labour colleagues. 'There is no moral case for these cuts to disability benefits. But for Labour MPs not yet persuaded that it's morally wrong to balance the books on the backs of the disabled, this data will be an electoral wake-up call,' he said. 'This cruel policy doesn't just betray our values, but risks contributing to this being a one-term Labour government. The idea that voters hit by these cuts have 'nowhere else to go' is outdated nonsense. They do and so do their friends and family. Other parties are waiting in the wings and in many Labour-held seats with large numbers of disabled people, this policy will help pave the way for Reform.' DWP has promised a £1bn employment support package to help more disabled people into work and additional support for those disabled people who have no prospect of ever working. The data was compiled by Julia Modern, the co-chair of Disability Poverty Campaign Group. 'Some of us will lose up to £10,000 a year, which is nearly 60% of the income that a disabled person who cannot work because of disability receives through universal credit and Pip,' she said. 'At least 350,000 people will be pushed into poverty as a result, joining the 4.8 million disabled people who already live in poverty in the UK. 'The results suggest Labour is making a colossal political mistake. We urge Labour backbenchers to do the right thing: to speak up and say they will not vote for such cruel and badly thought-through cuts.' A Department for Work and Pensions spokesperson said: 'We have been clear that protecting people in need is a principle we will never compromise on … Our reforms will unlock work for sick and disabled people who can and want to be in employment … ensuring they are supported to live with dignity and independence, whilst making sure that everyone who can realise the benefits of work is expected and supported to do so.'
The Guardian
26-03-2025
- Business
- The Guardian
Everything is great, nothing to see here, Rachel Reeves tells MPs
Whatever you do, just don't call it an emergency budget. It's a SPRING STATEMENT, you halfwits. Everything is totally normal. This is precisely the fiscal event that Rachel Reeves had always planned to give. Why the long faces? What could be more Labour than implementing massive welfare cuts just days before the tax rises you imposed last autumn come into effect? Just another day in Westminster. 'I have full confidence in the chancellor,' Keir Starmer declared at prime minister's questions. You couldn't help wondering if this was the equivalent of a football club chair insisting that the manager's job was safe just days before sacking him. There again, Keir isn't spoilt for choice over possible replacements. Reeves looks to be by far the best qualified member of the cabinet. It probably hadn't occurred to you that things could be even worse. There were cheers from a small section of the Labour benches as Reeves began her emer-, sorry, spring statement. These were most definitely Rachel's fanclub. Her Useful Idiots. They would continue to cheer throughout. Even when there was nothing to cheer about. Perhaps they didn't understand the implications of what she was saying. Large sections of the backbenches remained silent for the full half-hour. Reeves began by saying Labour had been elected to bring change to the country. Yes. Sadly no one had told her that the change in question was meant to be for the better. But Rachel was not to be deterred. Everything was great, she insisted. The NHS had never been better. Interest rates were down. People had never had it so good. It wasn't the government that needed to switch direction. It was voters who needed to re-educate themselves. Always look on the bright side of life. Then to a few caveats. The world was an uncertain place. So uncertain that there must be no mention of He Who Cannot Be Named. There was a namecheck for Vladimir Putin for his work in destabilising the world order. But nothing for Donald Trump and the threat of a trade war. That there's a lunatic Orange Man-Child in the White House. When it comes to the US, we remain very much an uncomplaining supplicant. Our role to suck up whatever is dished out. Without even the hint of a raised eyebrow. Having set the scene, Reeves moved on. Why all the fuss? There was nothing much to see here. She had only bothered to show up because she had said she would last year. But she would take the opportunity to remind everyone that her fiscal rules were non-negotiable. The country was entitled to stability. Even if that meant that the most vulnerable people in the country would have to pay for it. Someone had to. So it might as well be the scroungers. 'We won't put the public finances at risk,' she said. Only she could put growth in the economy. It was just a shame the Office of Budget Responsibility had downgraded its growth forecast to 1%. Ever since Liz Truss's disastrous mini-budget, the OBR has acquired a not wholly deserved reputation for infallibility. I mean, anyone could have been better than Radon Liz. Even me. But now we are stuck with the OBR. Even though they are probably wrong. You just needed to learn to reprogramme your thoughts. Consider this downgrade to be a de facto upgrade. If it had been left to the Tories we would be in a recession. That was one way of looking at it, I suppose. But still not much comfort. Not even to her frontbench colleagues. As she continued to choke on the OBR's numbers, you could see cabinet faces fall. Apart from Wes Streeting and Liz Kendall. They looked improbably chipper. Wes because he's permanently upbeat and on message. He smiles to himself in his sleep. Liz because she's never met a benefit cut of which she didn't approve. Deep down she reckons that most people are scroungers at heart. She'll be thrilled the OBR had downgraded her previous cuts and Reeves had demanded more. Though devastated she didn't get to announce them herself. Older Labour ministers were shaking their heads at a second round of cuts in little more than a week. Next up came the wishful thinking. How Reeves managed to persuade the OBR to include £1bn of savings from tax evasion was beyond everyone. Normally this is just the kind of creative accounting that economists file under the 'magic money tree'. There's about as much chance of the government clawing back this £1bn as there is of Kemi Badenoch winning PMQs. Rachel must be a great deal more convincing in private than she is in public. Or maybe the OBR is easily flattered. We ended with a quick roundup of why all was well with the economy. It may be terrible now, but if we could all just hold our nerve it would be fabulous in four years' time. Just trust the process. And there was good news. A third world war was imminent. So we could rebuild our economy by manufacturing weapons of war. What better use of billions of pounds that could be spent elsewhere. And if some of us get killed in the conflict then so much the better. Fewer mouths to feed. It was all a bit bonkers. The world was a terrible, uncertain place but there was a narrow path to growth that was never likely to materialise because the world was a terrible, uncertain place. Understandably by the time Reeves sat down, most Labour MPs were in need of some light relief. Fortunately they had Mel Stride to deliver a few laughs to cheer them up. The best that can be said of the Melster is that he is an even less convincing shadow chancellor than Jeremy Hunt was a chancellor. He turned up with a speech full of crossings out and sentences highlighted in orange and green colour codes. Which was strange, because his immediate impact was of a man who was almost entirely clueless. There again, it didn't help that he began by saying the Tories had left the economy in tiptop condition. Not even the Tories believe that. 'What are the markets making of this?' Mel wondered. If he had cared to look, he would have seen that the pound and the FTSE were very marginally higher. Which, under the circumstances, was a huge win for Reeves. 'Reeling from one fiscal event to the next is no way to run the public finances,' he continued. True. But Labour had learned this trick off the Tories. Rachel could go to bed reasonably happy. There had been no major backbench rebellions. And Stride had reminded the Commons that however bad labour were, the Tories were even worse. Just spare a thought for all those in need who are about to lose their benefits.
