Will Rachel Reeves dare to hike income tax?

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This is Money

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4.4 • 734 Ratings

🗓️ 31 October 2025

⏱️ 37 minutes

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Summary

Despite repeated assurances that Labour would not break its election manifesto by hiking income tax, it appears it is now under consideration by the Chancellor in the Autumn Budget.

Why is Rachel Reeves mulling over this U-turn, how much would it cost us, and would she really dare to do it?

This is Money's Angharad Carrick, Helen Crane and Georgie Frost discuss.

Speculation over a 'mansion tax' in the Budget has also reared its head again. The team discuss whether it's a good idea to tax people with pricey homes, and how on earth HM Revenue & Customs would decide whether someone's house is worth more than £2million or not.

Elsewhere, some good news in store, as Goldman Sachs has predicted the Bank of England will cut interest rates at its meeting next week.

Does fading inflation and sluggish growth mean this is now on the cards, and would the Bank dare to make a move before the Budget beast is unleashed? The team discuss.

They also look at why we're now paying three times the energy standing charges we were six years ago, and why some chocolate biscuits can no longer call themselves chocolate.

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Hosts: Georgie Frost, Simon Lambert, Lee Boyce, Helen Crane

Producer: Georgie Frost

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Transcript

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0:00.0	Welcome to This is Money, sponsored by Charles Stanley Direct. I'm Georgie Frost and joining me and Helen Crane today is Ang Harrod Carrick.
0:09.4	And coming up, more speculation ahead of the autumn budget. This week, its income tax rises and a two million plus mansion tax.
0:16.4	But how would they work and will it be enough? Also stay, hope for borrowers as Goldman Sachs predicts the Bank of England will cut interest
0:22.7	rates next week.
0:24.0	The hated energy bill standing charges have tripled in six years.
0:28.3	Why do we now spend more on fees than ever before?
0:32.0	And chocolate shrinkflation.
0:34.8	Don't forget your step to say with all the latest breaking money news, just go to
0:37.9	this ismoney.co.uk or download the app. But first, a message from our sponsors. Ever feel like
0:43.8	you're second-guessing your money decisions? You're not alone. That's why Charles Stanley
0:47.7	direct have created their financial coaching service, one-to-one time with a real expert who
0:53.2	help you feel confident about your finances.
0:55.9	Start with a free 15 minute call at Charles-Stanley.com.ukuk forward slash financial coaching.
1:02.1	Go on, take that first step. Remember, investment involves risk. Now back to the show.
1:07.3	Despite repeated assurances that Labor would not break its election manifesto by hiking
1:11.9	income tax, it appears it is under consideration by the Chancellor ahead of the autumn budget.
1:18.6	The size of the 22 billion pound fiscal back hole, driven by the OBR's decision to
1:23.5	downgrade productivity forecast, may just be too big for Rachel Reeves to ignore.
1:28.7	Income tax is a biggie.
1:30.2	It accounts for approximately a quarter of the total tax take.
1:33.6	So how will it work?
1:35.6	How on earth will she get round it?
	...

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