Rachel Reeves will ‘tax rich’ in Budget to fill £30bn black hole | Politics | News

Rachel Reeves has signaled the better-off will have to “contribute more” ahead of her Budget. Treasury sources said the Chancellor would not cut spending or significantly increase borrowing.

But this will leave him with no choice but to raise taxes in the face of warnings of a black hole of up to £30bn in the public finances. Sources close to the Chancellor told The Telegraph: “He will be fair in asking them to contribute more to rebuilding our public services.”

A Treasury source added that it was prepared to take “difficult decisions” as the “stability” of the public finances was at risk, but insisted there would be no “return to austerity”.

They added that the economy was facing a “once-in-a-generation challenge” for which “quick fixes” were not possible.

They said the Chancellor was determined to “maintain tight control over public spending and wage war on waste” to keep inflation and interest rates low.

They said: “More debt will endanger our public finances, leaving future generations more indebted, while a return to austerity will condemn the country to decline.”

The announcement comes amid ongoing speculation about major tax increases ahead of next month’s Budget.

In its manifesto, Labor promised not to increase taxes on “working people”.