[ad_1]
The Chancellor has said he will not need to raise taxes to “top up” public spending, after facing pressure to clarify his future tax plans.
Rachel Reeves made headlines last week at a business conference when she said she “will not be going back” with tax increases in the coming years.
He previously refused to repeat the pledge when challenged to do so by MPs, but has now told reporters there will not be “another load of tax hikes”.
Conservatives have accused them of “undermining business confidence” and lacking a consistent message to firms.
It comes after employers announced a rise in National Insurance (NI) in the October Budget.
From next April, employers will have to pay NI at a rate of 15% on salaries over £5,000, instead of the current 13.8% on salaries over £9,100.
Ministers have argued the increase is a tough but necessary decision to fund public services and fix “holes” in public spending plans they inherited from the Conservatives.
But it has created a political row, with opposition parties saying it will hurt future economic growth and make companies less likely to hire workers.
Speaking at the Confederation of British Industry (CBI) conference last week, the chancellor suggested no further increases would be needed because Labour’s budget would “put our public finances back on a strong footing”.
She added: “Public services now need to stay within their means because I’m really clear, I’m not coming back with more debt or more taxes”.
She told business leaders she wanted to raise additional revenue “at once” to give firms confidence that they would not have to “come back for more” in future years.
But Business Secretary Jonathan Reynolds was less specific in his determination that there would not be a repeat of the “competitive” business tax hike, when asked by MPs.
Sir Keir Starmer then refused to repeat the pledge during Prime Minister’s Questions last week.
In a regular scrutiny session in the Commons on Monday, his first appearance in parliament since the CBI’s comments, Conservative MPs urged him to repeat his pledge not to raise taxes.
After the Chancellor refused to repeat a specific pledge not to raise business tax, the Conservatives accused her of failing to “go back on her word” and “undermining business confidence”.
“How can business be expected to create jobs, growth and wealth in the economy when government provides neither stability nor credibility?” Shadow Chancellor of the Exchequer Richard Fuller added.
But hours later on Monday at a conference in Hull for northern business leaders, politicians and the media, she said she would not “return to raising taxes or indeed borrowing more” to fund public services. “
“Now I’ve set the envelope for government spending for the next few years, so I don’t have to go back and raise it, either by borrowing more or by taxing more,” he added. He added.
But she suggested that possible future economic shocks meant she “wouldn’t be able to write a five-year budget in just five months”.
“We don’t know what the future holds in terms of shocks to the economy,” he added.
[ad_2]
Source link