Mon, 27 Oct 2025

Mon, 27 Oct 2025 Chancellor hints at tax and spend shift to cushion Budget

Reeves said she wanted to ensure the UK had sufficient headroom to provide resilience against future shocks.

* Chancellor Rachel Reeves has confirmed that tax rises and spending cuts are options as she prepares for November's Budget.
* She aims to give herself more "financial breathing space" and ensure the UK has "sufficient headroom" to provide resilience against future shocks.
* The £9.9bn buffer allowed in last year's budget is not considered sufficient, and Reeves did not rule out tax rises when asked about them.
* The government's previous promises not to increase income tax, VAT or employees' national insurance rates may be weakened, with a commitment now only to keep taxes "as low as possible" for working people.
* Reeves will meet ministers from Saudi Arabia and Qatar on Monday and Tuesday to promote trade and investment deals with the Gulf region.
* A series of two-way trade and investment deals are expected to be announced during her visit to the Future Investment Initiative in Riyadh.
* The government is keen to promote the UK as a stable and attractive place to do business for countries in the Gulf Co-operation Council (GCC).
* Barclays Bank has announced plans to restart investment banking in Saudi Arabia, with an office set to open in Riyadh next year.
* There are warnings that the Employment Rights Bill will deter job creation, with some businesses urging support for an amendment that would bring in new rights and protections after six months.
* The UK's productivity level has been downgraded by the Office for Budget Responsibility (OBR) in early Budget forecasts.
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