Businesses could be set to face a hike in National Insurance, the chancellor has hinted.
Rachel Reeves has clarified that Labour’s pledge not to raise National Insurance for “working people” referred only to employees and not employers.
It is the strongest suggestion yet that firms are likely to be required to raise their contributions with the new government’s highly Budget to be announced later this month.
It comes as the government announced it had secured £63billion in private funding towards projects in the country.
And although the investment summit is a boost, Reeves warned the budget, to be announced on October 30, would be “tough”.
Firms across the country are eagerly awaiting news on potential tax increases, and the chancellor has ruled out raising VAT and income tax.
Reeves also vowed to cap corporation tax at 25% over the next five years.
She also suggested a possible change to the government’s borrowing rules to allow for billions in additional spending for large projects.
She said: "We do want to free up investment in those long-term responsible investments that we need to make, to unlock the private investment into our economy.”
Speaking at a Government investment summit in London, Ms Reeves also insisted she would not back down on the controversial cut to winter fuel payments.
The Chancellor has warned she will have to increase taxes and cut public spending at the Budget on October 30, claiming that the Conservatives had left a £22billion black hole in public finances.
However, Ms Reeves has insisted that increasing employers’ National Insurance contributions in the Budget won’t break Labour’s promise to protect working people from tax rises.