Reeves Reportedly Drops Income Tax Rise Plans Ahead Of November Budget. Chancellor Rachel Reeves is expected to abandon plans to raise income tax rates in her 26 November Budget, according to reports in the Financial Times. The move marks a major U-turn for Reeves and Prime Minister Sir Keir Starmer, who were warned that any increase would anger voters and Labour MPs by breaking an election manifesto pledge. Speaking on BBC Breakfast, Culture Secretary Lisa Nandy said “no decisions are set in stone” until the Budget is announced. But financial markets reacted sharply to the reports with the yield on 10-year government bonds jumping 11 basis points and sterling falling 0.3% against the dollar. Reeves had refused to rule out a rise earlier this month, saying “everyone will have to contribute.” If she rules it out, she’ll need alternative ways to plug a £20 billion shortfall while meeting strict debt and borrowing rules, possibly by extending the freeze on income tax and National Insurance thresholds.