Keir Starmer faces PMQs ahead of Rachel Reeves' 'tax-hiking' budget

Keir Starmer is set to face Prime Minister’s Questions on Wednesday ahead of Rachel Reeves’ ‘tax-hiking’ budget announcement.

The chancellor is due to deliver her second budget in the House of Commons on Wednesday.

Reeves told MPs on Monday night that the Budget will focus on three priorities: “Cutting the cost of living, cutting NHS waiting lists and cutting the cost of debt.”

There is wide speculation that Labour is planning to raise taxes on Wednesday in an effort to bridge a multibillion-pound gap in Government spending plans.

Earlier this month, she dropped plans to hike the headline rate of income tax, something which would have broken a Labour manifesto pledge, after receiving economic forecasts which were not quite as grim as first feared.

However, the chancellor is said to be considering a suite of other tax changes, including freezing income tax revenue thresholds for another two years. However, Scotland sets its own rates.

Reeves is also said to be considering increasing the full new state pension to a level above the threshold, and potentially implementing a “mansion tax” on properties worth more than £2m.

There is speculation that the budget could also impose limits on how much employees can contribute to their pensions under salary sacrifice schemes before they become subject to national insurance.

Reeves could also announce a gambling tax, a crackdown on small company tax avoidance to close a multi-billion pound tax gap, and a pay-per-mile charging for electric vehicles.

Speaking ahead of the announcement on Wednesday, Reeves described the Budget as being for “the British people”.

She said the Government would work with them to “build a fairer, stronger and more secure Britain”.

The chancellor insisted she will use her Budget to introduce measures to tackle the cost of living crisis, as the beleaguered Government hopes to keep backbench Labour MPs on side.

PMQs will be broadcast from the House of Commons at midday on Wednesday, and will be followed immediately by the chancellor’s budget announcement.