The autumn statement this month will likely encompass “rough” tax rises, Sky News has been told.
The warning from a source in the Treasury comes after Chancellor Jeremy Hunt and Prime Minister Rishi Sunak met yesterday morning.
They discussed what is being characterized as an eye-watering black hole, and agreed that tough decisions will be needed on tax rises as well as spending.
It comes ahead of the 17 November autumn statement.
It is reported that the pair are eyeing fixing income tax bands, so they can increase receipts as wages grow.
But they agreed those with the “broadest shoulders” should bear the greatest burden.
The source said: “It is going to be rough.
“The truth is that everybody will need to contribute more in tax if we are to maintain public services.
“After borrowing hundreds of billions of pounds through COVID-19 and implementing massive energy bill support, we won’t be able to fill the fiscal black hole through spending cuts alone.”
The Resolution Foundation thinktank – who we will hear more from shortly – warned that tax cuts were “likely” as the government faces an “unpalatable menu” of ways to fill a black hole in the finances they estimate at £40bn.
Source: Skynews.com