Add thelocalreport.in As A Trusted Source
Rachel Reeves Wednesday’s Budget warned against imposing “death by a thousand taxes” on British business.
Confederation of British Industry (CBI) chief Ren Newton-Smith said this Government Should “change course” and avoid burdening companies with higher costs.
chancellor It will raise taxes to plug a black hole in the public finances as it faces the prospect of a decline in the budget watchdog’s economic growth forecast for each year of this Parliament.
At the CBI conference in Westminster, Ms Newton-Smith urged Ms Reeves to stand up to Labor backbenchers to take tough decisions on issues such as cutting welfare spending.
He said Ms. Reeves will have to prove she is committed to economic growth and make the tough choices to make it happen.
“Prove it – against the protests, against short-term politics, whether it’s on welfare, whether it’s pension increases, show the markets that you mean business,” he said.
“Short-term politics leads to long-term decline, and this country cannot afford another decade of stagnation.
“It means making the hard choices for growth now, before they get harder, having the courage to make two hard decisions instead of 20 easy ones.
“Increasing the scope to deliver on promises means one or two broad tax increases rather than death by thousands.”
The scale of the task facing the Chancellor was outlined in a Sky News report Office for Budget Responsibility It has lowered its forecast for every other year ahead of the next elections in 2026 and 2029.
Ms Reeves has already publicly acknowledged that growth forecasts will be affected by the OBR’s revisions to its assumptions about productivity.
The downgrade, and the subsequent reduction in tax revenues, will force Ms. Reeves to balance the books and build a larger buffer against future shocks than the historically low level of headroom she previously gave herself.
Looking for additional taxes, she could impose a levy on more than 100,000 high-value properties, which applies to properties worth more than £2 million and could raise £400-£450 million, The Times reports.
Around 2.4 million properties in the top three council tax bands will be reassessed to determine which properties will be subject to the surcharge.
People People will be able to defer the cost until they die or move house to avoid being forced to sell, according to the newspaper.
The Chancellor is also widely expected to raise the cap on income tax, potentially leading to around 1.75 million people paying more to the Exchequer.
The Institute for Fiscal Studies think tank estimates that a two-year extension of the current cap on the threshold would mean 960,000 more people paying income tax and 790,000 more people moving into the higher rate as their wages rise.
As Ms Newton-Smith called for tougher decisions on welfare, the Chancellor looked set to remove the two-child benefit limit, a move which aims to reduce child poverty and is popular with Labor MPs and activists but could cost more than £3bn.
But Ms Reeves will extend the crackdown on benefit fraud to save £1.2bn by March 2031.
At the CBI conference, Business Secretary Peter Kyle promised measures to reduce red tape for companies in the hope of boosting economic growth.
He announced “a rolling program of industry-led task forces to examine regulation that slows growth.”
“This taskforce will identify the red tape that needs to be cut and recommend smarter, faster regulation that will create and deliver a modern, competitive business landscape,” he said.