Assessing the UK Labour government’s tax policies in its first year in office

Abstract

The article examines the tax policies the UK Labour government pursued in its first year in office in the context of its economic and fiscal inheritance. It presents the promises of the 2024 Labour Party Manifesto and the government’s main tax policies to June 2025. The article considers several possible interpretations of the government’s tax policies including the desire both to raise revenues and to establish fiscal credibility and assesses whether tax measures have been used to address social policy goals. The article concludes that, while cautious and even conservative, Labour’s approach to tax and tax policy making did not appear to be based on a cohesive plan, was not accompanied by a coherent or compelling narrative and failed to seize the opportunity for a bolder strategy.