Threat of income tax rise grows as Rachel Reeves gives clear sign she will break Labour manifesto pledge

At a glance

• Ahead of the November 26 Budget, the Chancellor warned in a speech on Tuesday morning that “people must understand the circumstances we are facing,” signalling that higher taxes are likely due to the UK’s weak public finances.

• Reeves pledged that her Budget will be “fair,” prioritising reducing NHS waiting lists, tackling the cost of living, and cutting national debt, while protecting those on modest incomes.

• A £20 billion shortfall in forecasts from the Office for Budget Responsibility—blamed partly on Brexit and the financial crisis—has forced Reeves to consider significant tax rises to rebuild fiscal “headroom.”