With stark economic challenges facing Prime Minister Rishi Sunak's government, all Britons were warned on Monday that they will have to pay more in tax in the coming years to fix the country's fiscal black hole.
Mr Sunak and Chancellor of the Exchequer Jeremy Hunt met on Monday to discuss tax and spending plans before an economic statement planned for November 17.
They agreed “tough decisions” are required on tax rises and on spending to fill the “eye-watering” gap in Britain’s public finances, a Treasury readout said.
“They agreed on the principle that those with the broadest shoulders should be asked to bear the greatest burden,” the Treasury said.
“However, given the enormity of the challenge, it is inevitable that everybody would need to contribute more in tax in the years ahead.”
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The brutal assessment lays out the challenge for Mr Sunak as he seeks to guide the country through a cost-of-living crisis that’s led to the government pledging tens of billions of pounds to help households and businesses cope with surging energy prices this winter.
At the same time as rolling out that aid, the prime minister is looking for savings and tax increases totalling as much as £50 billion ($57bn) as he seeks to rebuild the UK’s credibility with financial markets after the disastrous economic strategy pursued by his predecessor, Liz Truss, roiled financial markets.
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Mr Hunt is due to announce an Autumn Statement — essentially a budget in all but name — on November 17 and is considering options including extending a windfall tax on energy firms and freezing personal income tax thresholds.
It is also likely to involve politically difficult spending cuts for government departments which may further harm the Conservative Party’s poor ratings in the polls.
