Rahel reeves His manifesto pledge should not be u-turn Raise taxes For working people or heads Kir StamorThe government will be forced to give up other major priorities, warning one of the former top advisors to the Chancellor.
Jim O’Neel, a former goldman Sachs chief replaced the Treasury Minister Who left the conservatives and later advised Ms. Reeves, saying that she has no choice but to leave the major parts of her economic policy – including her commitment to not increase income tax, National Insurance Contribution to employees or VAT.
Questioning whether that promise was now durable, he told thatIndependent: “Without changing some big taxes, welfare and pension, they (Labor)) Northern powerhouse rail, small modular atomic reactors (SMRs), and can not be committed to things such as various other things that will create an investment and development difference. ,
His comments come in view of a disastrous week Sir Kir Ki Sarkar As minister was Forced to leave major parts Welfare reforms to prevent rebellion by Labor MPs, Leaving £ 5bn black hole In plans for its expenses.
Defined in a week Ms. Reeves openly shed tears With questions on his future, the pressure on the government has increased in PMQ, to balance the books and to balance the strategy of dramatically change, Chancellor with accepting That U-turn came on a “cost”.
But with the brilliant leaving the labor in the elections – and Prime Minister Facing the growing rude from the backbenth – the mention of the missions of the government has all disappeared, while economy Continues stabilizing.
Lord O’Neel claimed that the part of the problem was that the government was caught Short -term thinking About this Nigel Faraj And reforms that have taken a big pole lead.
He said, “He needs to stop worrying about Faraj, he has matters before four years before he matters.”
While reflecting the problems with the welfare reform bill, he moved forward: “In the last few days, the government should be forced to really prioritize, linked specific priorities with its development mission, 24/7 should get out of social media, and,, significantly, identify that all three may not distribute their fiscal rules, development missions and manifestations taxes.
“I will personally leave the triple lock on pension, and current welfare bills, and say they are going to carry forward more serious welfare improvements.”
Top Polster Luke Treel, UK Director More in Common, told Independent To fix public services before the next election, the government will now be better than proceeding through a large tax hike.
He said: “At this stage, the government would be better to increase a wide-based tax and will ensure that they may feel that it is doing better, the UK is completely broken compared to the public feeling compared to the risk.
“Will not be without pain after boxing himself in breaking the promise, but options – not seeing changes in four years of the public – politically and very bad for the country’s mood.”
On Friday, whatever Ms. Reeves accepted, refused to rule the tax growth in it, “harmful” climbing welfare deduction. The Chancellor said that it has warned that any tax increase in this autumn is likely that he is likely to be more painful than those in the last October, in which all low hanging fruit options were taken.
Asked if she can deny tax hike, she told Mentor: “I’m not going, because it would be irresponsible for a Chancellor to do so.” However, the government is being opposed to increasing calls from Labor MPs for a money tax to fill holes in public finance.
Meanwhile, the UK’s leading economic thinkex has warned that tax growth is inevitable with speculation that pension funds and new rules can be raided to offer people by investing their money in pension.
Director of Paul Johnson, Institute of fiscal studies (IFS) said: “If we are watching £ 30bn – which is quite admirable – you cannot see a way in which you raise that kind of money without killing people on middle income.
“If you are looking for big money, then this income tax should be something in national insurance or VAT.”
Senior economist Ben Casswell, senior economist at the National Institute of Economic and Social Research (NIESR), said: “It seems, looking at the review and allocation of given funds (and poor GDP growth and public finance), increasing taxes in autumn seems to be almost indispensable at this point.”
Tax Advisors Tax founder Tax Expert RJ Kumar warned: “In the next budget, Rhel Raves will be seen deeply excavating, taxes will be carried forward to cover government spending on defense and promote infrastructure. If these hikes are cripping businesses, these are the working families that will pay the final price.”
As a warning, the Prime Minister strongly indicated that the government is going to bring the tax growth in the next budget.
In an interview with Nick Robinson of BBC, the presenter claimed that Sir Kir said: “I am not going to put your taxes up,” adding: “Then the tax increased. ,
The Prime Minister hit back: “Nick, be fair, we had a commitment of an a declaration that we would not increase income tax, national insurance and VAT for the people working. This was a manifesto commitment. That is what I told you the last time, and that is what we have kept.
“So one thing we did not do in the last budget was that we did not violate the commitment of that manifesto. We are not going to break the commitment of that manifesto.”
Critics have mentioned that his response only closed the door to increase tax on Big Three -Income Tax, VAT and National Insurance.
Already, a leaked memo for Ms. Reeves from Deputy Prime Minister Angela Rener has revealed that the party is emphasizing for so -called money taxes on super rich and big corporations on the left side of the party.
Ms. Rener designed eight potential new funds taxes instead of cutting public services.