Rayner urges Reeves to consider rising wealth taxes ahead of spring statement | taxes and expenditures

Angela Rayner urged Rachel Reeves to consider a series of rising wealth taxes, a move that underscores uneasiness within the government about the prime minister's tight spending plans.

The deputy prime minister sent it to the Prime Minister, which estimated to be between £3 billion and £4 billion a year before the spring statement in March proposed eight potential tax measures, including restoring pension life allowances and raising bank-company tax rates.

The proposals were not adopted, and Reeves chose to announce cuts to cut public spending in March under her self-imposed fiscal rules.

While the memo obtained by the Daily Telegraph serves as a framework for discussion papers, it is likely to be seen as Rayner leaning against the ground in a cabinet increasingly shaped by Starmer's stale centralists.

The document called "a alternative proposal to increase income", believes that the measures will not violate Labor's 2024 declaration assurance and do not raise taxes "for workers".

Recommendations include ending estate tax relief in stocks listed on the smaller AIM stock market, eliminating the £500 tax exemption and freezing the threshold for the additional income tax rate of 45p.

Reiner also recommends raising the dividend tax rate for earners and targeting real estate traders who use corporate structures to avoid stamp duty.

Former conservative Prime Minister Jeremy Hunt abolished pension life allowance while serving. Labour promised to restore it when opposes, but would promise to give up before the election. The memorandum suggests that the change could raise £800 million.

The memorandum was sent two weeks ago and put pressure in the cabinet ahead of Reeves’ fiscal statement on March 26, exceeding the expected cuts in spending review this summer.

It is understood that Rayner raised concerns directly at the cabinet meeting in March, and several ministers reportedly questioned whether the cumulative income package had been fully explored.

Government insiders said it is not uncommon to distribute policy documents across departments informally and the proposals should not be considered official approval.

This tension reflects greater discomfort in the direction of economic policy by some labor MPs, especially criticizing the Prime Minister’s decision to expand the overseas aid budget and providing stricter qualification tests for individual independent payments.

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Although Reeves has so far resisted calls for tax increases, she is expected to revisit revenue packages in her fall budget as public finance forecasts deteriorate.

When asked about the BBC breakfast memo, Environment Minister Steve Reed said the cabinet “unified the government’s plan of change.”

Reid said Labour has increased taxes on the rich and stressed changes to the non-tax situation, which he said would lead to the wealthiest salary.

Conservatives seized on the memorandum as evidence of labor taxation instinct. "The Prime Minister has repeatedly refused to rule out another tax raid in the fall, and now we know why - Labour's top brass, including the Deputy Prime Minister, wants to come back more."

"We don't comment on the leak," a government spokesman said.