Reeves admits tax hikes will hit working people as IFS accuses chancellor of ‘undermining trust’

Labour chancellor Rachel Reeves admitted that her Budget will reduce the pay of working people due to increased employers’ national insurance contributions, as the IFS accused her of damaging trust in politicians. Despite claiming to protect workers, the IFS director criticized Reeves for not raising taxes as promised in the government’s Budget, stating that the measures would not generate the expected £25bn. The Office for Budget Responsibility warned that the spending measures would only provide a temporary GDP boost, leading to downgrades in subsequent years and increased pressure on inflation and interest rates.

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