RACHEL Reeves has dropped a big hint that she will clobber Brits with bigger than expected tax rises in next month’s Budget.
The Chancellor said she wants more money in the piggy bank for a rainy day – known as “fiscal headroom”.
But she warned that will mean tax rises or tough spending cuts.
The Chancellor said: “Would I like more headroom? Of course I would.
“But that does come with trade offs, because more headroom requires more tax revenue or less spending on public services like the NHS.
“So you’ve got to get the balance right there.”
Ms Reeves had around £10 billion of ‘fiscal headroom’ at the last Budget – which is very low by normal standards.
Speaking on a trip to Washington in the US, the Chancellor admitted “volatility” in the markets means she wants more in the piggy bank in case of economic shocks.
She said: “I think with the volatility that we’ve seen, having more security against those or greater buffer against that volatility would be useful, but does come with trade offs.”
Taxes were hiked by £40 billion in last year’s Budget.
But economists reckon Ms Reeves still has a blackhole of over £20 billion to fill this year.
