Experts have warned that recent higher than anticipated government borrowing figures have increased the prospect of Chancellor Rachel Reeves raising taxes at the next Budget.
Official data showed that government borrowing was £20.2 billion in April, which was an increase of £1 billion from the same month in 2024.
Experts have warned that weaker economic growth anticipated over the coming months could affect tax receipts, which would pile pressure on government finances.
The Chancellor aims to bring stability to the UK economy by paying for day-to-day government costs through tax income rather than borrowing and getting debt falling as a share of national income by the end of the current parliament.
Ruth Gregory, Deputy Chief Economist at Capital Economics, said: ‘With the Prime Minister announcing a partial U-turn on the cut to winter fuel payments, the dilemma faced by the Chancellor over how to deal with increased spending pressures in environment of low economic growth and high interest rates hasn't gone away.’
28/05/2025
View all >
04/06/2025
IFS outlines ‘decisions’ for Spending Review
Ahead of the 2025 Spending Review on 11 June, the Institute for Fiscal Studies (IFS) has outlined four ‘big decisions' for the government to make.
READ MORE
HMRC names and shames
HMRC recently named and shamed UK employers who have failed to pay their employees the National Living Wage (NLW) or the National Minimum Wage (NMW)
Chancellor outlines pension ‘megafunds’ plans
Chancellor Rachel Reeves has set out government plans to double the number of so-called pension ‘megafunds’ by 2030
Sign up to keep in touch to receive our latest news and industry updates.
* *
Yes, I would like to receive email updates providing me with the latest finance news, advice guides and details of future events.