David Vance SubstackRead More
If you thought that her budget in October 2024 was bad, (and it REALLY was bad) then you ain’t seen nothing yet! Chancellor Rachel Reeves looks set to deliver a brutal blow to vulnerable groups, from pensioners to small business owners in late November. Drawing on proposals from the left wing Resolution Foundation—whose alumni now populate many key Labour roles—we see a high-tax blueprint. This might extract £30 billion annually, pushing the tax burden to its highest in seven decades. It’s no exaggeration to suggest that the Resolution Foundation basically runs the Exchequer these days and that’s really bad news for many of us.
Pensioners face the sharpest edge. Labour REALLY hate this group and you will recall took away their Winter Fuel allowance last year. Now, a proposed 2p hike in the basic income tax rate to 22%, paired with a 2% cut in National Insurance contributions (which most pensioners do not pay), nets £6 billion extra but it’s the pensioners who will be mostly paying this over to the rapacious Reeves.
Freezing tax thresholds for two more years adds another £7.5 billion sting, dragging more modest pensions into the 20% bracket. The Labour spin says this is just a mere technical adjustment; nonsense, it’s a betrayal of Labour’s “no tax rises on working people” pledge! It will further erode trust amongst an aging electorate already grappling with inflation at 3.8%—the G7’s highest. Economically, there is a high risk of it suppressing consumer spending, a key growth driver, as fixed incomes shrink. I can’t see HOW our economy can grow at all of this.
Landlords and the self-employed will fare no better. Amid a housing crisis demanding more rentals, a further £6.5 billion in small business levies will deter investment, exacerbating shortages. It almost guarantees FEWER rental properties. Could she be so stupid as not to see this?
Even life’s small indulgences aren’t to be spared: £3.5 billion from sugar-salt duties and £4 billion from flight, shipping, and EV taxes smack of further puritanical overreach. This scatters real fiscal pain across society, ignoring root issues like NHS inefficiencies (20% productivity lag) or £40 billion in regulatory compliance costs.
This nightmare before Christmas budget will be the last she delivers, I believe. Her first budget was bad but this one will choke the UK economy to death.
