Will Labour hike taxes to placate Trump?

The News Agents

Global

Daily News, News, Government, Politics

4.2 • 4.3K Ratings

🗓️ 3 June 2025

⏱️ 37 minutes

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Summary

Less than 24 hours after the Defence Secretary stood up in the Commons to unveil the government's strategic defence review, months in the making, and it looks like NATO are forcing the MOD to go back to the drawing board.

The PM couldn't completely commit to 3% of GDP going on defence spending, despite that being an essential part of the review. And now, according to briefings in the newspapers, NATO is forcing Britain (and all members) to commit to a new 3.5% target within a decade. The aim? Convince Trump that NATO is worth standing by - with Russia feeling emboldened, there are heightened warnings that a NATO country could be his next target.

But the timing could hardly be more awkward for the Labour government. Just a week out from what could be a brutal spending review, the additional demands on defence will force tens of billions of more to be found to fund our army. Are taxes rises and harsh spending cuts now inevitable to placate the US president?

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Transcript

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0:00.0	The Newsagents podcast is brought to you by HSBC UK, opening up a world of opportunity.
0:09.3	This is a global player original podcast.
0:12.8	3%. That is what we want to achieve because of the different world that we live in,
0:18.9	but I'm not going to put arbitrary dates on that percentage.
0:23.6	We will do that as we did with 2.5 in a work-through way to deliver the capability that we need
0:29.4	under this review.
0:30.2	That was Kirstama, refusing to sign up to the amount of defence spending that he has currently
0:37.1	being pushed towards by many of the opposition yesterday.
0:41.4	Today, all that's changed with news that NATO is going to force Britain to sign up to a target that is even greater.
0:51.0	That could, in other words, rewire the entire spending of our country.
0:56.1	But if Kirstama thought it was difficult to get to 3% of GDP for military spending,
1:01.9	how on earth will he get to 3.5% of GDP? Actually, is this a claim? Is this a suggestion
1:08.7	that is never likely to happen? Welcome to the newsagents.
1:17.3	The newsagents. It's Emily. It's Lewis.
1:20.1	And yesterday there was more than one interview with the Prime Minister where he was being pushed to accept the need for defence spending to rise, not just to the
1:30.2	commitment he's already made for two years' time, but even further than that, to 3%.
1:35.3	And you heard Stama's words there. He didn't want to submit to arbitrary timings and fantasy figures
1:42.8	on what we would be spending on defence. And that line held,
1:47.3	I guess, gently for all of about 12 hours. And today it looks as if there is a concerted effort
1:55.2	by NATO, by their new Secretary-General, Mark Rutter, to say, OK, enough. You guys don't get it. Europe doesn't
2:04.2	get it. We need to show Trump we're serious. And if we mean to be independent in terms of European
2:11.1	defense and standing up to Russia, we are going to go even further than any of you are thinking.
	...

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