Britain is nearing ‘peak tax’

The article argues that Britain’s recent and planned tax rises—driven by Chancellor Rachel Reeves—are pushing the UK toward a “peak tax” outcome that risks slowing growth. IMF and OBR forecasts show government revenues rising sharply (IMF: 42.1% of GDP by the start of next decade; OBR: ~38.5% by 2031). Measures such as frozen personal allowances, frozen student-loan thresholds and higher National Insurance are pushing millions into higher brackets, raising marginal tax rates (notably large jumps around £50k and £100k) and deterring work, hiring and spending. Economists warn these distortions could reduce revenues and raise the UK savings ratio, weighing on consumer demand and GDP — an outcome that is likely negative for the pound (GBPUSD) and UK-sensitive assets.