OBR chief warns higher tax 'not good' for growth hopes

RACHEL Reeves risks harming potential growth through extra tax hikes, the fiscal watchdog has warned.

- By Mauricio Alencar

The Chancellor looks poised to raise taxes in the Budget. Leading City analysts believe the higher cost of borrowing and unfunded spending commitments on welfare will force the Government to raise as much as £30billion.

But Richard Hughes, the head of the Office for Budget Responsibility, has warned Ms Reeves she could undermine her growth mission if taxes are raised further.

Appearing before MPs on the Treasury Select Committee, who questioned him on the OBR's devastating assessment of public finances, Mr Hughes said: "There are a number of different levers the Government can pull.