Prime Minister Sir Keir Starmer signals tax rises coming as he warns of ‘painful’ budget

Published

7 months ago

August 27, 2024

admin

The October budget will be “painful”, Sir Keir Starmer has said, giving the biggest hint yet of tax rises.

Speaking from Downing Street, the prime minister said: “I will be honest with you, there is a budget coming in October and it’s going to be painful.”

He added: “Just as when I responded to the riots, I’ll have to turn to the country and make big asks of you to accept short-term pain for long-term good. The difficult trade-off for the genuine solution.”

Politics latest: Reaction as Starmer gives major speech

The budget is set to be held on 30 October.

Sir Keir said “those with the broadest shoulders should bear the heavier burden” and “those who made the mess should have to do their bit to clean it up”.

The first group he linked to the scrapping of the non-dom tax status, and the latter to water companies paying fines.

The Conservatives have accused the prime minister of a “betrayal” of people’s trust after he promised not to raise taxes.

Tory leader and former prime minister Rishi Sunak posted on social media: “Keir Starmer’s speech today was the clearest indication of what Labour has been planning to do all along – raise your taxes.”

The prime minister referenced the “£22bn black hole” in the nation’s finances, that he said the Office for Budget Responsibility did not know about – as he took aim at the last government.

“I said change would not happen overnight,” Sir Keir said. “When there is a deep rot at the heart of a structure, you can’t just cover it up… you have to overhaul the entire thing, tackle it at root. Even if it’s hard work or takes more time.”

Speaking about riots towards the end of July into the start of this month following the Southport stabbing attack which left three young girls dead – the prime minister hit out at a “minority of thugs that thought they could get away with causing chaos”.

Asked by Sky News political editor Beth Rigby which specific tax rises are being considered, Sir Keir reiterated that taxes on “working people” – like income tax, VAT and national insurance – will not go up.

He added: “We have to get away from this idea that the only levers that can be pulled are more taxes, or more spending.

“Our number one mission is to grow the economy.”

The prime minister was speaking from the rose garden at Downing Street – previously used by Boris Johnson’s adviser Dominic Cummings after he broke COVID lockdown rules, and also where gatherings took place during partygate.

This appeared to be a deliberate choice, as Sir Keir said: “This is a government for you, a garden and a building that were once used for lockdown parties.

“Remember the pictures? Just over there? With the wine and the food. Well, this garden and this building are now back in your service.”

Sir Keir has repeatedly blamed the previous government and said it is influencing his decision-making.

This includes the means testing of the winter fuel payments for pensioners.

‘Betrayal of people’s trust

The government’s claims of a £22bn “black hole” left by the Tories have been questioned following substantial pay awards to unions – including to both junior doctors and train drivers.

Sir Keir said he “didn’t want to means test the winter fuel payment”, but it was a choice that needed to be made to “protect the most vulnerable pensioners”.

👉 Click to subscribe to the Sky News Daily wherever you get your podcasts 👈

Laura Trott, the Conservatives’ shadow chief secretary to the Treasury, said: “The government are no longer promising to protect working people from their incoming tax raid because just like pensioners, working families are next in line for Labour’s tax hikes.

“After promising over 50 times in the election not to raise taxes on working people Labour are now rolling the pitch to break even more promises.

“The chancellor is entitled to raise taxes to pay for her expensive choices and above inflation pay rises demanded by her union paymasters, but she should have had the courage to be honest from the start.

“This a betrayal of people’s trust and we will hold them to account for their actions.”

Politics

Crypto stocks down, IPOs punted amid tariff tumult

Published

2 hours ago

April 4, 2025

admin

Crypto stocks down, IPOs punted amid tariff tumult

Cryptocurrency firms felt the heat from US President Donald Trump’s sweeping tariff rollout this week as market turbulence sent share prices tumbling and foiled initial public offering (IPO) plans.

From exchanges to Bitcoin (BTC) miners, crypto stocks suffered as much, if not more, than shares of other companies — despite the industry’s warm relationship with the US president.

On April 2, Trump announced he was placing tariffs of at least 10% on practically all imports into the United States and adding additional “reciprocal” tariffs on some 57 countries.

Since then, major US stock indices — including the S&P 500 and Nasdaq — tumbled by roughly 10% as traders braced for a looming trade war.

Sharp selloffs

Crypto exchange Coinbase — a prominent ally of Trump during the November US elections — experienced a similarly severe sell-off, with its stock price dropping by roughly 12% during the same period, according to data from Google Finance.

Bitcoin miners are also taking a hit. The CoinShares Crypto Miners ETF (WGMI) — which tracks a diverse basket of Bitcoin mining stocks — has lost roughly 13% of its value since immediately prior to Trump’s April 2 announcement, according to data from Morningstar.

Even Strategy, one of the best-performing stocks of 2024, wasn’t immune. Its share price has fallen by around 6% on the news, Google Finance data showed.

According to Reuters, investment bank JPMorgan has raised its estimated odds of a global economic recession in 2025 to 60% from 40% previously.

“Disruptive U.S. policies have been recognized as the biggest risk to the global outlook all year,” JP Morgan reportedly said.

“The effect … is likely to be magnified through (tariff) retaliation, a slide in U.S. business sentiment and supply-chain disruptions.”

IPO delays

The impact of US tariffs hasn’t been limited to stock price volatility. Stablecoin issuer Circle has reportedly paused plans for a 2025 IPO, citing market turbulence.

According to The Wall Street Journal, Circle is “waiting anxiously” before taking further steps after filing to take the company public on April 1.

It is among several companies — including fintech Klarna and ticketing service StubHub — reportedly considering altering or shelving IPO plans.

One exception may be Bitcoin itself, which some analysts say is finally “decoupling” from the broader market.

Bitcoin’s spot price has held above $82,000 this week, even as US equities markets collapsed.

Magazine: Unstablecoins: Depegging, bank runs and other risks loom

Politics

Brazilian court authorizes crypto seizure for debt collection — Report

Published

2 hours ago

April 4, 2025

admin

Brazilian court authorizes crypto seizure for debt collection — Report

Brazilian judges have been authorized to seize cryptocurrency assets from debtors who owe money and are behind on their payments, signaling a growing recognition that digital assets can be both a form of payment and a store of value.

According to local media reports, the Third Panel of Brazil’s Superior Court of Justice unanimously authorized judges to send letters to cryptocurrency brokers informing them about their intent to seize an account holder’s assets to repay creditors.

The report was confirmed by the Superior Court of Justice, which issued a notice on its website.

The decision was reached unanimously by the Third Panel, which reviewed a case brought forward by a creditor.

“Although they are not legal tender, crypto assets can be used as a form of payment and as a store of value,” a translated version of the Superior Court of Justice’s memo read.

Under existing rules, Brazilian judges are allowed to freeze bank accounts and order fund withdrawals, even without a debtor’s knowledge, should they rule that a creditor is owed money.

Following the recent decision, crypto assets now fall under the same purview.

Minister Ricardo Villas Bôas Cueva, who voted in the five-person panel, said cryptocurrencies still lack formal regulation in Brazil but noted certain bills have recognized the asset class as “a digital representation of value.”

Despite regulatory uncertainty, Brazil is a major hub for crypto

Although Brazil still lacks an overarching framework for digital assets, with the country’s central bank divvying up the regulatory processes into phases, crypto adoption is surging across the country.

Brazil ranks second among all Latin American countries in terms of “crypto value received,” which is a key benchmark for adoption, according to an October report by Chainalysis.

Earlier this year, crypto exchange Binance was granted approval to operate in the country after it acquired a São Paulo-based investment company.

A Binance executive told Cointelegraph at the time that Brazil was making “significant strides” in regulating the industry and expects a comprehensive framework to be finalized “by mid-year.”

Nevertheless, not all of Brazil’s regulatory proposals have been favorable for the industry.

In December, the country’s central bank proposed banning stablecoin transactions on self-custodial wallets at a time when more locals were using dollar-pegged tokens to hedge against the devaluation of the Brazilian real.

Industry observers told Cointelegraph at the time that such a ban would be difficult to enforce.

“Governments can regulate centralized exchanges, but P2P transactions and decentralized platforms are much harder to control, which means the ban would likely only affect part of the ecosystem,” said Lucien Bourdon, an analyst with Trezor.

Politics

‘Will the PM side with parents or tech bros?’: Labour peer demands action on children’s smartphone safety

Published

3 hours ago

April 4, 2025

admin

'Will the PM side with parents or tech bros?': Labour peer demands action on children's smartphone safety

Sir Keir Starmer needs to choose between parents who want stronger action to tackle harmful content on children’s phones, or the “tech bros” who are resisting changes to their platforms, Baroness Harriet Harman has said.

Speaking to Beth Rigby on Sky News’ Electoral Dysfunction podcast, the Labour peer noted that the prime minister met with the creators of hit Netflix drama Adolescence to discuss safety on social media, but she questioned if he is going to take action to “stop the tech companies allowing this sort of stuff” on their platforms where children can access it.

Sir Keir hosted a roundtable on Monday with Adolescence co-writer Jack Thorne and producer Jo Johnson to discuss issues raised in the series, which centres on a 13-year-old boy arrested for the murder of a young girl, and the rise of incel culture.

Politics latest: Could the UK retaliate against Trump?

The aim was to discuss how to prevent young boys being dragged into a “whirlpool of hatred and misogyny”, and the prime minister said the four-part series raises questions about how to keep young people safe from technology.

Sir Keir has backed calls for the four-part drama to be shown in all schools across the country, but Baroness Harman questioned what is going to be achieved by having young people simply watch the show.

“Two questions were raised [for me],” she said. ” Firstly – after they’ve watched it, what is going to be the discussion afterwards?

“And secondly, is he going to act to stop the tech companies allowing this sort of stuff to go online into smartphones without protection of children?

“Because if the tech companies wanted to do this, they could actually protect children. They can do everything they want with their tech.”

She acknowledged there are “very big public policy challenges” in this area, but added of the prime minister: “Is he going to side with parents who are terrified and want this content off their children’s phones, or is he going to accept the tech bros’ resistance to having to make changes?”

👉 Click here to listen to Electoral Dysfunction on your podcast app 👈

Can parliament keep up?

The Labour peer backed the Conservative Party’s call for a ban on smartphones in schools to be mandated from Westminster, saying it would “enable all schools not to have a discussion with their parents or to battle it out, but just to say, this is the ruling” from central government, which Ofsted would then enforce.

“I’m sensitive to the idea that we shouldn’t constantly be telling schools what to do,” she continued. “And they’ve got a lot of common sense and a lot of professional experience, and they should have as much autonomy as possible.

“But perhaps it’s easier for them if it’s done top down.”

Baroness Harman also questioned the speed with which parliament is actually able to legislate to deal with the very rapid development of new technologies, and posits that it could “change its processes to be able to legislate in real time”.

She suggested that a “powerful select committee” of MPs could be established to do that, because “otherwise we talk about it, and then we’re not able to legislate for 10 years – by which time that problem has really set in, and we’ve got a whole load more problems”.

On the podcast, the trio also discussed the 10% tariffs imposed on the UK by Donald Trump and the government’s efforts to strike a trade deal with the US to mitigate the impact of the levy.

The government has refused to rule out scrapping the Digital Services Tax, a 2% levy on tech giants’ revenues in the UK, as part of the negotiations with the Trump administration – a move Baroness Harman said would be “very heartbreaking”.

👉 Click here to listen to Electoral Dysfunction on your podcast app 👈