Amid growing concerns over Britain’s economic future, Keir Starmer faced a grilling in Parliament today that left more questions than answers—especially when it comes to taxes.
The spotlight was on the Prime Minister and Chancellor Rachel Reeves, as MPs demanded clarity on Labour’s fiscal plans in light of an estimated £30 billion shortfall in public finances.
A Familiar Face, A Different Mood
Rachel Reeves, who made headlines last week after a tearful Commons appearance, was back in her seat next to Starmer—this time smiling, but under just as much pressure.
The questions came fast and hard during Prime Minister’s Questions (PMQs), and it was clear from the start that Starmer wasn’t eager to give much away.
Starmer Sticks to Script on Big Three Taxes
When asked directly by Kemi Badenoch if Labour still stood by its promises not to raise income tax, National Insurance, or VAT, Starmer gave a clear and simple “yes.”
That was one of the few straight answers of the session.
The commitment lines up with Labour’s manifesto, which has repeatedly assured voters these core taxes won’t rise.
But What About the Stealth Tax?
Things got thornier when Badenoch pushed further, shifting the focus to tax thresholds.
She pointed out that while Starmer ruled out raising tax rates, he didn’t address whether the current freeze on thresholds would continue—something that quietly pulls more people into higher tax brackets as wages increase.
By not lifting the freeze, the government could raise around £10 billion a year without technically breaking their promise on tax rates.
Starmer refused to confirm either way, instead repeating Labour’s commitment to “fiscal rules.”
Is a Retirement Tax on the Horizon?
Badenoch didn’t let up.
She painted a stark picture of what freezing tax thresholds might mean for millions of vulnerable Britons, especially pensioners.
Under Labour’s silence on the issue, she argued, many low-income retirees could be taxed for the first time—a move she called a “retirement tax.”
Again, Starmer avoided making any new guarantees.
“We will stick to our manifesto commitments,” he repeated, insisting that the Conservatives simply didn’t understand fiscal discipline.
Reeves Caught in the Middle of a Funding Crisis
Meanwhile, Rachel Reeves remains in a difficult position.
Experts estimate that she could be staring down a £31 billion funding gap when it’s time for the Autumn Budget.
So far, she has stood firm behind Labour’s pledges, but economists say the slow economy and increasing spending pressures could force her hand.
Could This Be a Repeat of Last Year’s Record Tax Hike?
The Institute for Fiscal Studies (IFS) has already raised alarm bells, warning that Reeves might be left with no choice but to introduce tax increases that rival last year’s record £41 billion hike.
If Labour keeps its vow not to touch income tax, National Insurance, or VAT, they’ll have to find the money elsewhere—and fast.
Tory Party Sounds the Alarm
Following the tense PMQs session, a Conservative spokesman wasted no time in responding.
While he acknowledged that Starmer ruled out raising key taxes, he emphasized that Labour’s refusal to commit to lifting the income tax threshold freeze leaves the door wide open to stealth tax increases.
According to the Tories, Labour’s silence on other potential levies—including wealth and retirement taxes—paints a worrying picture of what might be around the corner.
“The only reasonable conclusion,” the spokesman warned, “is that a toxic cocktail of Labour tax rises is coming this autumn.”
What Comes Next?
With fiscal pressure mounting and political tensions rising, the big question remains: how will Labour bridge the gap without breaking its promises?
All eyes are now on the Autumn Budget, where the answers—and possible tax hikes—may finally come into view.
For now, the speculation continues.
