Chancellor of the Exchequer Rachel Reeves speaks on stage during the Labour Party conference on Sept. 29, 2025, in Liverpool, England.
Ian Forsyth | Getty Images
U.K. Chancellor Rachel Reeves is expected to give a clearer indication that tax rises are coming in her Autumn Budget later this month when she gives a speech this morning.
Reeves is set to address speculation around her fiscal plans shortly and is expected to tell the British public that her budget will focus on “fairness and opportunity.”
“You will all have heard a lot of speculation about the choices I will make,” she is expected to say, according to excerpts of her speech published in advance by the BBC.
“I understand that. These are important choices that will shape our economy for years to come. But it is important that people understand the circumstances we are facing, the principles guiding my choices – and why I believe they will be the right choices for the country,” she is expected to say.
Reeves is due to set out the Autumn Budget on Nov. 26 and it’s widely expected that it will include tax rises despite the ruling Labour Party having pledged ahead of its 2024 election win, not to raise income tax, VAT or national insurance contributions.
The chancellor faces difficult choices after pledging to stick rigidly to her “fiscal rules” to make sure day-to-day government spending is funded by tax revenues and not borrowing, and to ensure public debt is falling as a share of economic output by 2029-30.
Reeves faces an agonising choice on whether to prioritise politics or economics as she finalises her budget, Mujtaba Rahman, managing director of Europe at Eurasia Group, said in a note late Monday night.
“The economics increasingly points to what Whitehall insiders are calling a ‘go big’ strategy: another large tax hike, including on income tax, to close a gap of about £30 billion to meet Reeves’s goal of balancing government spending and revenue by 2029-2030,” Rahman said.
While financial markets would welcome substantial fiscal consolidation, small-scale tax rises are unlikely to be enough, he said.
Labour will be very wary of abandoning its election manifesto promise not to raise income tax, however, and any moves to do so will leave the party wide open to attacks from opponents such as the Conservatives and increasingly popular party, Reform.
“While no decision has yet been taken, Eurasia Group believes that on balance it is now narrowly more likely that the chancellor will decide “go big” and breach the manifesto pledge on income tax,” Rahman said.
Critics of the government have branded her speech on Tuesday an an “emergency press conference” given there was little indication it would take place until last night.
