UK set for 'short term pain for long term good', says Starmer

Those with the broadest shoulders should bear the heaviest burden’ as Starmer announces non-domiciled residents will be the first affected.

Speaking in the garden of No 10 on 27 August, prime minister Keir Starmer said the upcoming budget ‘is going to be painful’ as no knowledge of the £22bn black hole in the public finances forced the government to implement severe changes, such as the Winter Fuel Allowance.

Starmer said: ‘Those with the broadest shoulders should bear the heaviest burden. That’s why we’re cracking down on non-doms. Those who made the mess should have to do their bit to clean it up.’

Further fines will be imposed on the water companies which have been illegally pumping sewage into the UK’s rivers lakes and seas.

‘I’ll have to turn to the country, and make big asks of you as well, to accept short-term pain for long-term good, the difficult trade-off for genuine solution,’ said Starmer.

However, the prime minister reiterated that income tax, national insurance and VAT would not be changed, which was pledged in Labour’s Manifesto.

Starmer continued: ‘We were being honest about the situation before the election, we set out very clearly what we would be doing with tax rises, I made it clear on numerous occasions that national insurance, VAT and tax would not go up, and that remains the position.’

Former prime minister, Rishi Sunak said on X (formerly Twitter): 'Keir Starmer's speech today was the clearest indication of what Labour has been planning to do all along - raise your taxes.

Laura Suter, director of personal finance at AJ Bell said: ‘While the speech’s key points largely mirror those made by chancellor Rachel Reeves in July, Starmer still struck an ominous tone.

‘His comments will also reignite the rumours of a specific ‘wealth tax’ to be paid by the wealthiest in the UK. This could just take the form of increasing existing taxes for investors and the top earners, or it could be a new, standalone tax on those with the biggest pockets.

‘Unsurprisingly, the record of the previous government was dragged over hot coals as Starmer defended last month’s decision to means test Winter Fuel Payments from this year.’

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