Downing Street has confirmed that the Autumn Budget will not be announced until at least mid-November, as the Treasury is yet to provide the Office for Budget Responsibility (OBR) with its ten-week notice to commence drafting forecasts.
A spokesperson from No 10 informed reporters on Tuesday afternoon that a date for the Autumn Budget has not been finalised, as reported by .
Last year's Autumn Budget took place on October 30, and there have been suggestions that Rachel Reeves intends to schedule this year's Budget around the same period.
Historically, Chancellors have planned this significant fiscal event for late November, with Jeremy Hunt presenting the 2023 Budget on November 22.
The lack of a confirmed date implies that government officials are playing a waiting game, hoping that the º£½ÇÊÓƵ economy will exceed City predictions and alleviate concerns in bond markets. This comes amidst leading economists forecasting that inflation will reach four per cent in September and growth will continue to be sluggish.
Debate underway in Downing St
Policy discussions are currently underway at Downing Street ahead of the Budget. Keir Starmer has reshuffled his team, appointing former Treasury minister Darren Jones as the chief secretary to the prime minister, a newly-created role centred on policy implementation.
Minouche Shafik, a former deputy governor at the Bank of England and official at the International Monetary Fund, has been named as Starmer's chief economics adviser.
The recent shift towards an economics-focused approach within Downing Street has not been well received by the bond market, with the 30-year gilt yield hitting its highest level this century on Tuesday afternoon.
Investors in gilts have expressed concern over Labour's reluctance to reduce government spending, which they believe is eroding its fiscal credibility and triggering a widespread sell-off.
An asset manager commented that the potential tax increases proposed by Rachel Reeves to restore her fiscal buffer, including additional property levies, could lead to "uncertain impact on revenues" and stifle economic growth.
Big tax raid incoming
Capital Economics released fresh analysis indicating that the Chancellor might need to raise up to £28bn in taxes due to possible downgrades in growth forecasts by the Office for Budget Responsibility and increased borrowing costs.
The report suggested that raising "sin taxes" and scrapping relief on AIM shares could be viable options for the government, while extending income tax thresholds under the guise of a "defence levy" could generate more funds but at a political cost.
Tax reform is seen as the "holy grail", yet it remains an "elusive" goal, stated Ruth Gregory, deputy chief º£½ÇÊÓƵ economist.
Gregory predicted that households and banks are likely to shoulder the majority of tax hikes, with the overall effect on the economy over the next year being mildly stagflationary.
