Great Britain London wants to save billions: Taxes up, spending down
In the fight against a huge budget deficit, the British government wants to raise a total of 40 billion pounds (approx. 45 billion Swiss francs) with tax increases. Finance Minister Rachel Reeves criticized the previous government for leaving a budget gap of 22 billion pounds and concealing important information from the independent watchdog OBR.
30.10.2024, 16:31
SDA
Commentators spoke of a historic budget: Reeves is the first woman in history to head the British Treasury.
"Any Chancellor of the Exchequer standing here today would have to face up to this reality, and any responsible Chancellor of the Exchequer would have to take action," said the incumbent in Parliament in London. All ministries are to make savings of 2 percent in their department and significantly more loans are to be taken out than planned. The supervisory authority only expects annual economic output to grow by a maximum of 2 percent by 2029.
This is the first time in around 15 years that the Labor Party has presented a budget. Prime Minister Keir Starmer's Social Democrats are in government for the first time since 2010.
The minister promised that employees would have more money at their disposal. Income tax and VAT will not rise and the minimum wage will be increased significantly. She wants to "invest, invest, invest" in order to rebuild the UK, said the Chancellor of the Exchequer.
Lots of investment needed
The government wants to invest billions in the NHS, schools, prisons and infrastructure. Victims of two major scandals are to receive a total of around 13.5 billion pounds in compensation. Fuel duty will remain frozen.
Reeves wants to finance these measures primarily with higher taxes for companies. An increase of 1.2 percent in employers' social security contributions is expected to raise 25 billion pounds. The government is hoping to raise £2.5 billion from an increase in capital gains tax, while the tax on tobacco products and the tax on sugary drinks and air travel will also be increased. Tax loopholes for private schools will be closed in order to invest 9 billion pounds in state schools.
