Reeves Drops Income Tax Increase Plan, Spurring Selloff in Gilts

Chancellor of the Exchequer Rachel Reeves has dropped plans to raise the headline rates of income tax in the coming UK budget, prompting a sharp selloff in gilts as investors questioned how she could make up for the revenue shortfall.

Reeves has decided not to go ahead with increasing either the basic or higher income tax rates after widespread concerns were raised internally about breaking Labour’s election promise not to do so, people familiar with the matter said.