{"id":363172,"date":"2025-08-21T22:36:12","date_gmt":"2025-08-21T22:36:12","guid":{"rendered":"https:\/\/www.europesays.com\/uk\/363172\/"},"modified":"2025-08-21T22:36:12","modified_gmt":"2025-08-21T22:36:12","slug":"rachel-reeves-slammed-for-maxing-out-britains-credit-card-politics-news","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/uk\/363172\/","title":{"rendered":"Rachel Reeves slammed for maxing out Britain’s credit card | Politics | News"},"content":{"rendered":"

Rachel Reeves<\/a> has been warned that Britain\u2019s finances remain \u201cchronically weak\u201d, as new figures revealed she is still maxing out the country\u2019s credit card. The Chancellor was hit with yet more bad news today as it was revealed public sector borrowing has risen to \u00a360billion since April, nearly \u00a37billion more than last year.<\/p>\n

While borrowing in July was lower than expected, Ms Reeves was warned the data \u201cdoes little to brighten the gloomy outlook ahead of the Budget\u201d. July\u2019s better-than-expected figures were helped by a record-high monthly tax take of \u00a3100billion, including \u00a32.6billion from Labour\u2019s hike to employers\u2019 National Insurance Contributions<\/a>. Top Tory Helen Whately warned Britons that \u201ctax rises are inevitable\u201d, as reports emerged that Labour is eyeing a raid on pension pots<\/a> by slashing the maximum people can take out without paying tax.<\/p>\n

Ms Whately\u2019s prediction was backed by economist Elliott Jordan-Doak, who said Ms Reeves will have to raise taxes in October.<\/p>\n

The Pantheon Macroeconomics specialist warned: \u201cThe litany of policy U-turns has only compounded the Government\u2019s fiscal woes. We think the Chancellor will need to resort to \u2018sin\u2019 and \u2018stealth\u2019 tax hikes, duty increases, and a pensions tax raid in order to meet her fiscal rules if she wants to meet her pledge of keeping headline tax rates unchanged.<\/p>\n

\u201cThe big picture remains that the public finances are in chronically weak condition.<\/p>\n

\u201cThe Chancellor faces surging gilt yields and a likely productivity downgrade from the [Office for Budget Responsibility] in the October forecast round.\u201d<\/p>\n

Reaction to Thursday’s public borrowing figures, Shadow Chancellor Sir Mel Stride said: \u201cRachel Reeves<\/a> is spending money she doesn\u2019t have. Just like every Labour government in history, this one only knows how to tax more, spend more, and borrow more.<\/p>\n

\u201cBorrowing should be coming down, but under Labour it is higher than the same period last year. Starmer and Reeves are gambling with Britain\u2019s future through a string of unfunded U-turns and a refusal to get spending under control. Tax rises in the autumn now look all but inevitable.<\/p>\n

\u201cOnly the Conservatives<\/a>, under new leadership, will take the responsible decisions needed to live within our means and bring down the national debt.\u201d<\/p>\n

Morgan Stanley, the US investment bank, issued a new report on Thursday suggesting Ms Reeves could be looking at a \u00a320billion black hole at the Budget.<\/p>\n

The bank said expectations of such a gap \u201cdon\u2019t seem implausible to us\u201d.<\/p>\n

Alex Kerr, of Capital Economics, predicted Ms Reeves will be forced to raise taxes by between \u00a317 and \u00a327billion to remain compliant with her self-imposed fiscal rules.<\/p>\n

He added: \u201cUltimately, today\u2019s release does little to brighten the gloomy outlook ahead of the budget later this year.\u201d<\/p>\n

Ms Reeves was warned on Thursday that a planned tax raid on the sale of family homes could end up losing money overall.<\/p>\n

Labour-supporting tax expert Dan Neidle argued that the rumoured tax hike, which would end Capital Gains Tax relief when selling, would \u201cslash transactions, gum up housing chains, and could even collect less tax overall\u201d.<\/p>\n

He pointed out that there is good reason why no major European economy taxes the sale of houses.<\/p>\n

Former head of the Institute for Fiscal Studies, Paul Johnson, agreed that the tax would \u201cblock up the entire housing market\u201d as \u201cno one would ever sell their properties\u201d.<\/p>\n

He added: “I just can’t believe that they’re considering it. I\u2019m staggered that they\u2019re flying this flag. It, to me, makes no sense.\u201d<\/p>\n

Darren Jones, Ms Reeves\u2019s deputy at the Treasury, said: \u201cFar too much taxpayer money is spent on interest payments for the longstanding national debt.<\/p>\n

\u201cThat’s why we’re driving down government borrowing over the course of the parliament \u2013 so working people don’t have to foot the bill and we can invest in better schools, hospitals, and services for working families\u201d.<\/p>\n","protected":false},"excerpt":{"rendered":"Rachel Reeves has been warned that Britain\u2019s finances remain \u201cchronically weak\u201d, as new figures revealed she is still…\n","protected":false},"author":2,"featured_media":363173,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[6],"tags":[51,127381,619,53501,1523,16,127380,15],"class_list":{"0":"post-363172","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-business","8":"tag-business","9":"tag-public-sector-borrowing","10":"tag-rachel-reeves","11":"tag-tax-rises","12":"tag-taxes","13":"tag-uk","14":"tag-uk-public-finances","15":"tag-united-kingdom"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@uk\/115069149741560498","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/363172","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/comments?post=363172"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/363172\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media\/363173"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media?parent=363172"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/categories?post=363172"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/tags?post=363172"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}