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Budget tax rises 'inevitable' as borrowing at 5-year high
September 20, 2025
|The Herald
CHANCELLOR Rachel Reeves has been dealt a further setback after official figures showed the highest August borrowing for five years, with warnings mounting that tax rises at the autumn Budget now look “inevitable”.
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Latest figures from the Office for National Statistics (ONS) showed far higher-than-expected borrowing last month, at £18billion, £3.5bn more than in August 2024.
Soaring interest on Government debt - up £1.9billion to £8.4bn - added to higher spending on benefits and public services and offset any boost from the National Insurance Contributions (NICs) hike, according to the ONS.
It marked the highest August borrowing since 2020, significantly overshooting the £12.8bn expected by most economists and was £5.5bn higher than forecast by the UK’s independent fiscal watchdog, the Office for Budget Responsibility (OBR), in March.
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