Independent

Chancellor warned tax rises needed to fill 51bn black hole in public finances

Metaculus

Keir Starmer

Office for Budget Responsibility

Ben Riley-Smith

Goldman Sachs

KPMG

Naomi Smith

Robert Colvile

UK Trade & Business Commission

Sharon Graham

"Today's #GDP growth figures are still a long way from @Keir_Starmer's target of 2.5% and it is far from clear that we are heading in the right direction."

"The OBR will drop the forecast for 2025/26 growth from 2% to around 1%."

"Labour are promising to be the fastest-growing country in the G7. And our growth forecast is 2% or less every single year of this parliament? Yeah, good luck with that."

"The economy is expected to grow by just over 1 per cent this year, rising to 2 per cent in 2025."

Research shows that "deep alignment with the EU on goods and services will deliver 2.2% economic growth to the UK."

"Closer ties with the EU could deliver growth of up to 2.2%. Clawing back up to half the damage caused by Brexit."

"Certainly, yes [when pressed on whether he was seeking to achieve growth of 2.5 per cent]."

Will the UK Economy Grow By 2% GDP In a Year Under Labour?

The National Institute of Economic and Social Research (NIESR) has forecasted that the U.K. government will face a current budget deficit of £41.2 billion by fiscal year 2029-30, putting Chancellor Rachel Reeves off track to meet her stability rule.

BBC News

NIESR

The National Institute of Economic and Social Research (NIESR) has forecasted that the U.K. government will face a current budget deficit of £41.2 billion by fiscal year 2029-30, putting Chancellor Rachel Reeves off track to meet her stability rule.

NIESR recommends moderate but sustained tax increases to close the budget gap and restore a £9.9 billion fiscal buffer, requiring the Treasury to raise approximately £51 billion through taxes or spending cuts by 2029-30.</span

the Guardian

NIESR recommends moderate but sustained tax increases to close the budget gap and restore a £9.9 billion fiscal buffer, requiring the Treasury to raise approximately £51 billion through taxes or spending cuts by 2029-30.

The think tank suggests that filling the budget shortfall would require tax increases equivalent to adding 5 pence to both the basic and higher rates of income tax, though it recommends broader tax reform instead.</span

The Telegraph

Daily Mail

The think tank suggests that filling the budget shortfall would require tax increases equivalent to adding 5 pence to both the basic and higher rates of income tax, though it recommends broader tax reform instead.

Chancellor Reeves faces what NIESR calls an impossible trilemma between meeting fiscal rules, maintaining spending commitments, and avoiding tax rises on working people as promised in Labour's manifesto.</span

Daily Mirror

Chancellor Reeves faces what NIESR calls an impossible trilemma between meeting fiscal rules, maintaining spending commitments, and avoiding tax rises on working people as promised in Labour's manifesto.

The living standards of the poorest 10 percent of UK households declined by 1.3 percent in 2024-25 compared to 2023-24 and remain approximately 10 percent lower than pre-Covid levels.</span

The living standards of the poorest 10 percent of UK households declined by 1.3 percent in 2024-25 compared to 2023-24 and remain approximately 10 percent lower than pre-Covid levels.

NIESR expects UK economic growth of 1.3 percent in 2025 and 1.2 percent in 2026, with inflation averaging 3.3 percent in 2025 and 2.8 percent in 2026, above the Bank of England's target.</span

NIESR expects UK economic growth of 1.3 percent in 2025 and 1.2 percent in 2026, with inflation averaging 3.3 percent in 2025 and 2.8 percent in 2026, above the Bank of England's target.

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Higher taxes will worsen economic problems by damaging business confidence and reducing investment. Labour's economic mismanagement created this black hole through poor planning and policy reversals. Tax rises will harm working families and slow growth further.

Higher taxes will worsen economic problems by damaging business confidence and reducing investment. Labour's economic mismanagement created this black hole through poor planning and policy reversals. Tax rises will harm working families and slow growth further.

Rachel Reeves will have to make huge tax hikes in autumn Budget to fill a 50 BILLION black hole, economists warn

UK Faces £41bn Budget Gap, Tax Rises Likely Needed

Governance

Money

Politics

United Kingdom

World

Tax increases are essential to restore fiscal credibility and prevent market instability. The £41 billion shortfall demands immediate action to rebuild the fiscal buffer and signal commitment to responsible governance. Without decisive tax measures, Britain risks losing international investor confidence.

Tax increases are essential to restore fiscal credibility and prevent market instability. The £41 billion shortfall demands immediate action to rebuild the fiscal buffer and signal commitment to responsible governance. Without decisive tax measures, Britain risks losing international investor confidence.

Reeves facing 50bn black hole as tax pressure mounts

UK Faces £41bn Budget Gap, Tax Rises Likely Needed

UK Faces £41bn Budget Gap, Tax Rises Likely Needed

The Spin

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Graham

Riley-Smith

Colvile

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Commission

Smith

Starmer

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UK Faces £41bn Budget Gap, Tax Rises Likely Needed

UK Faces £41bn Budget Gap, Tax Rises Likely Needed

The Spin

The Controversies

Graham

Riley-Smith

Colvile

Responsibility

Commission

Smith

Starmer

Articles on this story

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