Britain’s Finance Minister Rachel Reeves presented the first budget of the Labor Party on Wednesday. There has been a change of government in Britain after about 14 years and the Labor Party has made a comeback by removing the Conservative Party government. Its effect is also visible on the government budget. The way has been cleared for increasing taxes in the country.
Britain’s Finance Minister Rachel Reeves announced an increase in tax collection by 40 billion pounds (about 52 billion dollars) in her first budget. In his budget speech, he said that the money coming from the tax increase will be used in investment to move the economy forward. Besides, the government will also focus on putting more pounds in the pockets of common people.
Attempt to fill the economic black hole
Finance Minister Rachel Reeves, presenting the first budget of the Labor Party government that returned to power in July, said that the money raised through tax increases would help improve the condition of public finances. Also, it will be invested in the country for economic growth.
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He said that it has become necessary to increase taxes to fill the ‘economic black hole’ created during the previous Conservative government. Rachel Reeves said that she is working towards restoring the stability of public finances. She is focusing on reconstructing public services.
The Finance Minister said that before assuming power in July, he had made predictions about the economic condition of the country. The situation is much worse than that. Keir Starmer, who became PM from the Labor Party, has already warned after taking over the reins of the government that the budget and fiscal discipline of the government will be close to reality, that is, there is no question of tax relief.
Emphasis on improving the condition of schools and hospitals, more pounds for the common man
Finance Minister Rachel Reeves said in her budget speech that the government’s focus will be on providing the necessary financial boost to public services like schools and hospitals and growing the economy, as promised. The government will focus on putting more pounds in people’s pockets.
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The government has to do this work within a very limited scope. The Finance Minister said that to improve the foundation of the economy, higher taxes will have to be imposed and public spending will need to be increased in limited quantities. He said that the financial situation has weakened during the 14 years of Conservative Party rule.
However, Conservative MPs say he has left an economy with low levels of debt. It was growing with a much lower deficit than other rich countries in the G-7 group of countries.
