Rachel Reeves expected to drop plans for income tax rise

Rachel Reeves has dropped plans to increase income tax rates at the Budget on 26 November, according to reports in the Financial Times.

The newspaper says the chancellor and prime minister U-turned on increasing the tax, which would have broken an election manifesto promise, over fears it would anger voters and Labour MPs.

Speaking to BBC Breakfast, Culture Secretary Lisa Nandy said “no decisions were made or set in stone” until Reeves delivered the Budget in the House of Commons.

The Treasury have not responded to a request for comment.

Reeves had not publicly confirmed she would raise income tax rates but had refused to rule it out.

Earlier this month, she also delivered a pre-Budget speech in which she emphasised the need to make “necessary choices” and warned that everyone would have to “contribute”.