Kemi Badenoch calls for Chancellor to ‘get the axe’ if she raises tax at Budget

Kemi Badenoch is set to urge the Prime Minister to sack Rachel Reeves if she increases taxes at next month’s Budget.

At a pre-Budget rally on Thursday marking a year since Ms Reeves’ first fiscal event, the Tory leader will demand that the Chancellor “get the axe if she puts up tax”.

Ms Reeves is widely expected to increase taxes next month as she attempts to bridge a gap in her spending plans thought to amount to more than £20 billion.

And on Wednesday, Sir Keir Starmer himself declined to repeat his commitment to Labour’s manifesto pledge not to raise income tax, national insurance or VAT.

Promise

Before the rally, Mrs Badenoch said: “Nobody voted for high taxes and out-of-control spending, but that’s what they’re getting from this weak Prime Minister.

“After her Budget last year, Rachel Reeves promised she was ‘not coming back with… more taxes’. But now that looks like a lie as she is gearing up to impose more punishing tax hikes.”

Shadow chancellor Sir Mel Stride, who is also expected to address the rally, said: “My message to Sir Keir is simple: if Rachel Reeves breaks her promise again, she must go.”

Ms Reeves faces another challenging Budget on November 26 as she finds her spending plans squeezed by weak economic growth, persistent inflation and an expected downgrade to the Office for Budget Responsibility’s productivity forecasts.

The Institute for Fiscal Studies has warned she would need to find at least £22 billion of tax rises or spending cuts to restore the £10 billion “headroom” she previously left herself against her borrowing target.

Gap

But the figure could be even higher if the OBR’s downgrade is larger than expected, and if she needs to pay for the expected abolition of the two-child benefit cap.

Some economists have argued that raising income tax would be the easiest way to bridge the gap, with alternative levies likely to cause more economic damage.

But to do so would break a key pledge in Labour’s 2024 manifesto, which promised not to raise income tax, national insurance or VAT.