Taxing Decisions: Should the government break its promise and raise income tax, national insurance or VAT to secure a ‘delivery dividend’?

As the government finalises its Autumn Budget amid mounting fiscal and political pressures, Demos’ final report in our series on tax asks a critical question: should the government break its manifesto pledge and raise broad-based taxes to fund national renewal?

Building on our earlier work on pro-growth tax reforms to plug the fiscal hole, how to gain public trust in tax rises and SME attitudes to taxation, this paper explores the next, and hardest, step.

Taxing Decisions considers whether raising income tax, National Insurance or VAT – which the government promised not to – may be the most effective way to secure the investment Britain needs to rebuild public services and infrastructure. But such moves would test the government’s credibility and risk further erosion of public trust. This report assesses those risks, and offers evidence-based strategies to mitigate them.

Together, these papers form a roadmap for an open, pragmatic, and citizen-led approach to tax reform – one that aligns fiscal responsibility with national renewal.