The thing about Rachel Reeves—apart from the ironed hair, the thousand-yard stare and the curious knack for speaking in spreadsheets—is that for someone who claims to be building economic stability, she’s remarkably good at causing chaos.
The sort of chaos that isn’t loud and fast and wrapped in flashing lights, but a slow, calculated, exchequer-shaped car crash. With every tax tweak and fiscal fiddle, the Chancellor seems less like a guardian of growth and more like a reverse Robin Hood—robbing not the rich to feed the poor, but hammering the hopeful to satisfy the ideological.
Let’s start with the millionaires, because of course we should. They’re the villains in the modern morality play, aren’t they? The hedge-funders, the tech bros, the Notting Hill set with unearned six-packs and actual pensions. But here’s the thing: they’ve gone. Vanished. Left faster than a party donor in a non-disclosure scandal. Spain, Portugal, the UAE—take your pick. Anywhere with sunshine and fewer punitive taxes on the fruits of your own bloody graft.
Capital gains? Hiked. Dividend taxes? Squeezed. Non-dom status? Dead. You can feel Rachel’s satisfaction radiating from the red dispatch box—“Look, I’ve made the system fair!” But fair to whom, exactly? Not to the rest of us who rely on those millionaires for investment, for job creation, for risk capital. You can’t build a booming economy while running a “For Sale: One Prosperous Nation, Owner Fled” sign in the City.
And then there’s the private school VAT debacle, a policy so proudly self-sabotaging you’d think it was dreamed up during a particularly long wait on hold with HMRC. Because nothing says “levelling up” like adding 20 per cent to school fees, causing a mass exodus from the independent sector and dumping thousands of bewildered middle-class children into a state system that can’t afford to mend the loos, let alone fund a Latin department.
We’re now in a situation where overstretched comprehensives—already juggling teacher shortages, dilapidated buildings and half-a-dozen TikTok-inspired behavioural epidemics—are being asked to accommodate pupils who were doing fine where they were. Because their parents, often two-job families scraping everything to give their kids a chance, suddenly can’t make the numbers work. So in one fell swoop, Reeves has created more pressure on state education and ensured that the very notion of aspiration has been subject to VAT.
And let’s not forget the little guys. The small businesses, the freelancers, the self-employed who, in the dreams of policy wonks, are seen as plucky start-ups in Shoreditch lofts, but in reality are your plumber, your dog groomer, your mum’s mobile nail technician. These people don’t have tax loopholes or offshore accounts. They don’t “max out their ISA” or play currency arbitrage on a second screen. They just want to make a living. And now, thanks to Reeves’s drive to close “the tax gap,” they are treated with the same suspicion as a Russian oligarch buying a Belgravia townhouse in crypto.
Every “crackdown” on self-employment, every tightening of IR35, every demand for real-time tax data is a signal: you are not to be trusted. And who gets hurt? Not the CEOs, not the multinationals with lawyers by the dozen. It’s the part-time bookkeeper in Bolton, the roofer in Romford, the events planner in Epsom. All of whom are now expected to carry the burden of fiscal fairness while HMRC plays hide-and-seek with the people who owe actual millions.
It’s one thing to talk about redistribution. It’s quite another to perform an economic exorcism on the country’s productive classes. Reeves doesn’t seem to realise that prosperity isn’t a finite pie to slice ever more thinly, but a delicate ecosystem. You scare off the high earners, overtax the employers, kneecap the educational ladder and shackle the self-employed, and you’re not left with equality. You’re left with inertia.
The Labour line is that all of this is necessary. A little pain now for stability later. But the pain always seems to be in the same place. It’s never Whitehall. Never the unions. Never the quangos or the consultants or the eye-wateringly wasteful procurement contracts. No. It’s families. Workers. People who run corner shops and send their kids to modest private schools because the local comp has had five headteachers in four years and is best known for a viral video involving a hamster and a Bunsen burner.
The tragedy of Reeves’s approach is not that it’s radical—it’s that it’s regressive. A kind of fiscal performatism designed more to tick boxes in a Guardian editorial than to encourage the next generation of wealth creators. She’s playing to the crowd, but the crowd isn’t watching. It’s working, or emigrating, or wondering if it’s time to switch the business to Dubai and homeschool on Zoom.
There was a moment, not long ago, when Labour could have genuinely claimed to be the party of the working ambitious. Of the kid from Leeds who wanted to start a coffee chain or build an app. But now? Now they look like the party of “No.” No to incentives. No to innovation. No to keeping what you earn. A party suspicious of success and hostile to the ladders that help you get there.
Every Chancellor has to make tough decisions. But Reeves has confused toughness with punishment, and prudence with paranoia. With every tax, she’s not just balancing the books. She’s burning the blueprint for growth. And once you’ve lost that, no amount of fiscal rules will bring it back.
