Chancellor Rachel Reeves has sparked controversy after suggesting that those with the “broadest shoulders” may have to pay more tax to help fill a multibillion-pound gap in public finances. Speaking at the International Monetary Fund meetings in Washington, Reeves ruled out a formal wealth tax but hinted at targeting assets such as property, pensions, and savings instead. Her comments have fuelled fears of a new tax raid on Middle England, with speculation that inheritance tax, landlords, and retirement schemes could face tighter rules.
Reeves defended her stance, saying wealth is “different from income” and that the better-off should “pay their fair share.” The opposition accused her of breaking previous promises not to raise taxes again after last year’s £40 billion tax-raising Budget. The Institute for Fiscal Studies warned that she may need to find an additional £42 billion to meet her fiscal rules, while business groups cautioned that further tax hikes could damage investment and job growth amid an already fragile economy.
The Chancellor is also under pressure to support struggling households, hinting at possible measures to cut energy bills, such as reducing VAT or green levies. However, such plans could cost the Treasury billions, worsening the financial shortfall. With the economy flatlining and inflation still high, Reeves faces mounting criticism from both businesses and political opponents, who argue that Labour’s approach risks stifling growth and punishing ordinary savers.
Credit to : TalkTV