UK finance minister expected to reveal 20 billion stg hole in public finances, Guardian reports

LONDON (Reuters) – Britain’s new finance minister Rachel Reeves is expected to reveal a 20 billion pound ($25.7 billion) shortfall in the public finances, potentially paving the way for tax rises in the next budget, the Guardian newspaper reported on Thursday.

The figure is not final and could still change before Reeves sets out an assessment of the public finances on Monday, the paper reported, citing unnamed sources within Britain’s governing Labour party.

Reeves, who became Chancellor of the Exchequer after Labour’s thumping election victory this month, had pledged not to increase income tax, National Insurance social security contributions, corporation tax or sales tax known as VAT.

A spokesperson for the finance ministry did not comment on the report but said: “The Chancellor has commissioned officials to provide an assessment of the state of the government’s spending inheritance which will be presented to Parliament before the summer recess.”

($1 = 0.7784 pounds)

(Reporting by Sachin Ravikumar; Editing by Alistair Bell)