The dust has now settled on Rachel Reeves’ first Budget, but it was a consequential event to which it is worth returning.
A Budget has to speak to different audiences, and the Chancellor would have known she had difficult messages to deliver to both the wider public and the business world. Employers, predictably enough, are unhappy with the significant increase in employers’ National Insurance contributions. Reeves wouldn’t have expected the general public to be thrilled with higher taxes either, but if anything the reaction has been more muted than she might have feared. This might reflect well on the public’s realism (recognising that taxes were always going to go up) or badly on its understanding of the tax system (it will be workers who ultimately bear the burden of higher employers’ NICs). Either way, Reeves will feel relatively relieved on this point.
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