Investment manager Justin Urquhart-Stewart has told Britons to brace themselves for a VAT surge.
He joined Tom Harwood on GB News to discuss reports that Chancellor Rachel Reeves is set to reveal a shortfall in public finances.
Urquhart-Stewart told Britons to take this as a sign that their bills are set to surge.
“You will see some slightly better growth figures next month”, he said.
Justin Urquhart-Stewart says we can expect VAT rises
GB NEWS / PARLIAMENT
“But I’m afraid at the moment, be prepared. You’re going to have more VAT and other areas like private schools will go up, that’s almost inevitable.
“They have to grow the economy. What you have got to do though is get confidence back into the economy.
“Where does that come from? Investors from overseas and internal. Really, they don’t have to be talking too much to us, but to investors.
“We will wait to see how good they are with their wise words.”
GB News’s Tom Harwood commented on Sir Keir Starmer’s suggestion he has been dealt with a poor hand from the previous government, asking whether this is purely “spin” from the new Labour government as they seek to justify potential tax rises.
“I am afraid people have short memories on this”, Justin Urquhart-Stewart said.
Rachel Reeves
PA
“We have to go through how these figures compare to how they actually were a few months back.
“Is there actually a shortfall? Have some of the expectations of growth been adjusted?”
The Chancellor is set to respond to the recommendations of independent pay review bodies on Monday, when she will also argue in Parliament that the Tories left Labour with a dire spending inheritance, including a £20 billion black hole.
Reports have suggested teachers and some 1.3 million NHS staff could be in line for a 5.5% pay boost, which could cost about £3.5 billion more than had been budgeted for.
Justin Urquhart-Stewart joined Tom Harwood on GB News
GB NEWS
Economists believe this could rise to about £10 billion if other pay review bodies give similar advice on workforces such as police and prisons officers and doctors and dentists.
Sir Keir Starmer has previously acknowledged there would be a cost if failing to follow the recommendations of the pay review bodies led to a fresh wave of industrial disputes in the public services.
Labour did not deny reports that Reeves could on Monday make the same argument as she signs off on the pay increases despite the shortfall in Government funding plans.
The findings of a Treasury spending audit she will detail on Monday will reveal “the true scale of the damage the Conservatives have done to the public finances”, a Labour source said.
An early assessment has reportedly found a nearly £20 billion annual gap between revenues and funding commitments.