Chancellor Rachel Reeves has confirmed that higher taxes on the wealthy will feature in next month's budget, but ruled out a new wealth tax. Speaking in Washington at the IMF annual meetings, Reeves said higher taxes on the wealthy are 'part of the story' for the 26 November budget.
Reeves dismissed criticism of previous tax measures, including VAT on private school fees and changes to non-dom status, as 'scaremongering' and 'bleating'. She noted that the Office for Budget Responsibility will update its forecasts on these measures, suggesting critics were wrong to predict people would leave the UK.
The chancellor hinted at tax increases for the most well-off, but declined to specify which measures. Speculation includes raising capital gains tax, levying national insurance on rental income and partners in law firms, and creating higher council tax bands. Reeves has previously ruled out a new wealth tax.
Reeves stressed the budget would not return to austerity, despite a downgrade in growth forecasts from the OBR. She said the package aims to boost economic growth and raise revenue, with departmental budgets already set in the spending review. She contrasted her approach with that of the Conservatives and Reform party.
Reeves criticised the OBR for the timing of its productivity review, which occurred after her June spending review. She said it would have been better if the OBR had adjusted forecasts earlier to help the new government understand the economic position.
