Keir Starmer faced questions about the possibility of increasing income tax during the upcoming Budget session, but he did not explicitly rule out the idea during a recent PMQs session. While affirming a commitment to avoid austerity measures, the Prime Minister did not reiterate the Labour Party’s previous promise from the last General Election to refrain from raising taxes on working individuals, including income tax, VAT, and national insurance.
During the parliamentary session, Conservative leader Kemi Badenoch challenged Starmer on upholding the party’s tax pledge. In response, Starmer avoided a direct answer and stated that the government’s fiscal plans would be disclosed at Chancellor Rachel Reeves’s Budget presentation on November 26.
In a further exchange, Badenoch reminded Starmer of Labour’s manifesto commitment to not increase income tax, national insurance, or VAT, and sought confirmation of the Prime Minister’s stance on these guarantees. Starmer deflected the question by highlighting positive economic indicators such as higher retail sales, lower inflation, upgraded growth forecasts, and record highs in the UK stock market.
Regarding the looming Budget, Starmer assured that the government would aim to strengthen the economy, reduce NHS waiting lists, and secure a prosperous future for the nation. Despite previously reiterating the manifesto promises, Starmer emphasized that the government does not unveil its budgetary intentions before the Budget announcement.
In a subsequent statement, the Prime Minister’s press secretary declined to reiterate the party’s former stance on taxation protection for working citizens, emphasizing that the Budget details would be unveiled on November 26 after the Office for Budget Responsibility’s final forecasts are considered.
Reports suggest that Chancellor Rachel Reeves is contemplating an income tax hike to address a significant budget shortfall, with options including adding 1p to the basic rate of income tax to generate approximately £8 billion. Speculation also points to a potential increase in higher income tax rates during the upcoming Budget, affecting individuals earning above specific thresholds.
The Treasury declined to comment on these potential tax adjustments, emphasizing that they do not engage in speculation regarding tax revisions.