Business leaders, economists and MPs have warned that Chancellor is risking thousands of job losses across the country under proposed plans to raise £40 billion in tax hikes and spending cuts.
Rachel Reeves is planning one the largest tax increases in history during her Autumn Budget on 30 October.
The most vulnerable tax hikes is thought to affect National Insurance and income tax, stealth taxes and wealth taxes along with spending cuts.
The Office for Budget Responsibility said that Labour’s National Insurance increase will lead to “lower wages and higher prices.”
The Institute for Fiscal Studies think-tank said that by increasing employer National Insurance contributions is quite simple “a tax on the earnings of working people.”
Laura Trott, the shadow Treasury Minister, warned Labour’s plans to increase National Insurance contributions will lead to a “bonfire of jobs right across the country.”
Former Chancellor Kwasi Kwarteng said the Chancellor is risking putting the economy in to a “doom-loop.”
Kwarteng blasted Labour saying, “They have given inflation-busting pay rises to the unions and that is why Rachel is now looking at freezing income tax thresholds.
“We tried to lower taxes, they are putting them up. If they don’t get any growth they will keep raising taxes.
“You will get a doom loop where you are putting up taxes and killing growth. She shouldn’t be putting up taxes. She should be curbing public spending.”
Tina McKenzie, from the Federation of Small Businesses told The Sun, said, “Hiking small firms tax is a recipe for cuts to pay, hours and jobs. Tax on work should be going down, not up.”
The Sun reported, Kate Nicholls, boss of UK Hospitality warned, “The government is hitting us with a triple whammy which is pushing up costs.
“They want big increases in the national living wage again – that has partly been driven by the big public sector pay agreements they have handed out.
“They have got their employment bill which brings extra costs for businesses.
“And now we are facing tax hikes. Something has got to give.”
