Chancellor Rachel Reeve is poised to raise taxes at the fastest rate of any UK finance minister in nearly 50 years, according to economic forecasters. Analysts at Capital Economics predict Ms Reeve will opt for £38bn of tax rises at the Autumn Budget, on top of the £41.5bn she raised last year – totalling just shy of £80bn.
This means she will have already raised taxes more after only 17 months in power than any of her predecessors did across an entire parliament since 1976. The last time any other chancellor came close was Denis Healey, who over three Budgets raised taxes by 2.2pc from 1974 to 1976, the year the UK had to be bailed out by the IMF.
Alex Kerr at Capital Economics said Ms Reeve was not the first Chancellor to come back for more so quickly over this period – pointing to predecessors like Denis Healy and Rishi Sunak. But he added, “the total size of her first two Budgets may surpass them all.”
Mr Kerr also warned that another Budget of this scale would have 0.3pc of the size of the UK’s already sluggish economy next year. The pound was on track for its worst month since July amid gloom around the Budget and uncertainty over interest rates.