Labour's Budget is already unravelling, Badenoch says

"The government had given strong indications it was planning to increase the tax - which would break an election pledge - but last week government sources said Rachel Reeves had decided against the move after better-than-expected economic forecasts."

"Badenoch also highlighted comments from the chancellor in her Budget last year, when Reeves said: "I am keeping every single promise on tax that I made in our manifesto", and said she would not extend the freeze on income tax and National Insurance thresholds because this "would hurt working people". The Tory leader asked the PM to confirm the government would not break this promise and continue the freeze on income tax thresholds. But Sir Keir dodged the question, only saying the Budget would focus on cutting NHS waiting lists, debt and the cost-of-living."

"Describing the situation as a "shambles", Badenoch accused the government of floating the idea of increasing income tax rates only to "U-turn". "This is the first Budget to unravel before it's even been delivered," she told the House of Commons. "The chancellor's cluelessness, I'm afraid, is damaging the economy now.""

Chancellor Rachel Reeves backed away from plans to raise income tax rates after better-than-expected economic forecasts. The proposed rise would have broken an election pledge. Kemi Badenoch called the situation a shambles and accused ministers of floating a tax rise only to U-turn, saying the chancellor's cluelessness is damaging the economy. Badenoch cited Reeves's prior pledge to keep all tax promises and not extend freezes because that would hurt working people. During Prime Minister's Questions Badenoch pressed the prime minister on whether income tax thresholds would be frozen; the prime minister refused to rule that out and said the Budget will focus on NHS waiting lists, debt and the cost-of-living.

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