Rachel Reeves, who tabled the first budget proposal for the Labor government that took power after July's parliamentary elections in the House of Commons in London, said the gravity of the public funding position inherited from the previous Conservative government should not be underestimated.
Shortly after the election, Reeves announced that the Conservatives, who had been in opposition after 14 years in power, had given state coffers £22 billion of unsecured public services, and that budget revenues should therefore be greatly increased.
The draft budget presented on Wednesday and awaited with intense interest by markets and the analyst community contains an annual average of 41.1 billion pounds (20 thousand billion forints) of increases in taxes and contributions for the forecast period up to 2029-2030.
The largest single element of the package of income-raising measures is a 1.2 percentage point increase in social insurance paid by employers.
The government expects to receive an additional £25 billion a year from this move alone from the next financial year, which begins next April.
The capital income tax on securities trading profits will rise from 20% to 24%, and customs duties on tobacco products will increase by two percentage points above the current inflation rate.
British Prime Minister Sir Keir Starmer has repeatedly said recently that “painful” budget measures will be needed to eliminate the tens of billions of pounds of funding deficit inherited from the Conservative government.
According to the latest Office for Statistics (ONS) report, the UK public debt to GDP ratio is close to 100 per cent. The ONS stressed that the public finance sector's debt burden was last at similar levels in the early 1960s.
The independent analysis workshop (Office for Budget Responsibility, OBR), which prepares official macroeconomic and public finance forecasts for the British government, declared in a recently compiled study based on model calculations: If there is no significant adjustment in fiscal policy, the British government will and The ratio of public debt to GDP is expected to reach 274 percent by the end of the next decade, and will rise to more than 300 percent.
