Chancellor ruled out possibility of income tax increase – report

Rachel Reeves has ruled out raising income taxes next month BudgetAccording to reports.

chancellor When asked how she would close the fiscal black hole in November, she had previously insisted that Labour’s manifesto commitment not to raise income tax, National Insurance or VAT “stands”.

but asked about the report treasure Ms Reeves told reporters on Friday she would “continue to support working people by reducing their taxes as much as possible” but was still “going through the process” of writing the budget, the BBC said.

The Chancellor said: “While I can’t talk about individual measures at this stage, I understand that the cost of living is still people’s number one concern.”

Ms Reeves is widely expected to use the budget to raise taxes once again, with the Institute for Fiscal Studies estimating she needs £22 billion of tax increases or spending cuts to meet the fiscal rule she has imposed.

The gap comes as a result of higher borrowing costs, weak growth and an expected decline in official productivity forecasts, although recent better-than-expected inflation data has eased the pressure slightly.

Raising the basic rate of income tax by 1p could raise around £8bn, but would break a clear manifesto pledge.

This will be the first time since the 1970s that the base rate has been increased.

The Chancellor is also reported to be considering cutting the amount people can hold in cash Jesus As part of a campaign to encourage investment in stocks and shares.

It is understood no decision has yet been made and a number of options are being considered, including halving the allowance from £20,000 to £10,000.

Treasury minister Lucy Rigby told the Telegraph the government is “considering the right balance between cash and shares in ISAs”.

He said: “The main thing is that we want people to be better off and one way to do that is to create shareholding democracy in this country.”

Meanwhile, The Times reported that the Chancellor will use the Budget to once again raise the minimum wage, and move further steps towards abolishing low minimum wage rates for young people.