The Chancellor only pretends she doesn’t want to hike our taxes.
Chancellor Rachel Reeves is fulfilling a Labour dream – but won’t get the glory (Image: Getty)
Rachel Reeves is acting as if she’s been reluctantly forced to act by events beyond her control. It’s all the fault of the Tories, Donald Trump, Nigel Farage, Vladimir Putin, Liz Truss… anybody but our actual, literal Chancellor. Don’t believe it. This Budget belongs to her, as the last one did. Her fingerprints are all over it.
Reeves and PM Keir Starmer crushed a recovering economy the moment they started banging on about the need for huge tax hikes straight after the election. Something they strangely forgot to mention during the campaign. Households and businesses took fright, and they were right. Last October’s Budget was even worse than feared.
Reeves slapped on more than £40billion of tax rises, the biggest raid since the early 1990s. Most of the pain landed on employers thanks to her £25billion “jobs tax”.
Since Labour took power, more than 270,000 jobs have vanished. Growth has ground to a halt. Yes, the Tories left a mess. Trump’s tariffs aren’t helping. And Liz Truss was rubbish.
But Reeves is the main culprit here. And now she’s coming back for even more.
The Chancellor is lining up at least another £30billion worth of extra tax, while refusing to cut spending in any meaningful way. She pretends to be sorry about it, but I don’t buy it. She’s got the backing of the Labour Party. It’s now living the dream.
Nobody joins Labour because they think the state is bloated and must be cut. That’s Tory austerity, the thing they despise most. They don’t want it on their consciences.
MPs and members sign up because they think the state doesn’t tax enough, doesn’t borrow enough, and doesn’t spend enough.
And Reeves thinks all of that too. Unless she somehow meant to scribble “Conservative” on her party application form instead of “Labour”. But even she couldn’t be that jungled, could she?
The only reason she looks so frazzled today is that she knows voters will personally blame her for the blitz, and Starmer may drop her like a stone to deflect the anger.
Reeves is expected to hike income tax by 2p in every pound we earn. She’ll blame the usual suspects, but needn’t bother. She’s simply doing what a Labour chancellor is designed to do.
On November 26, she’s about fulfil a 50-year Labour fantasy. Despite having no mandate to do so.
It’s been half a century since any Chancellor dared raise income tax. Labour’s Denis Healey was the man, hiking the basic rate from 33p to 35p as part of his mission to tax the rich “until the pips squeak”.
There’s plenty of that spirit on the left today, with activists banging on about wealth taxes and soaking the affluent. Reeves is about to repeat Healey’s trick, although from today’s lower 20p starting point.
And Labour will love it. The left never forgave Margaret Thatcher for driving down personal tax rates, and now they’re finally getting their revenge. A basic-rate tax hike is everything they’ve dreamed of for years.
Taxpayers will hate it. Breaking a manifesto pledge will trigger fury across the country. Labour but could be out of power for a generation.
But backbenchers will be on cloud nine. They’ve waited a long time for this moment. And Rachel Reeves is the woman to deliver it.
But here’s the twist. They won’t thank her for it. Because no matter how much tax pain she piles on, it will never be enough for them. Which means Labour will almost certainly be back for more.
