David Starkey issues serious tax warning over Rachel Reeves' plan for workers

Starkey warned that Reeves’ approach to the economy will “lead to devastating inflation”.

While Starkey conceded that the annual inflation rate was 2.8% in February 2025, down from 3.0% in January, he predicted it will soon rise again.

“I would reckon it will rise very much more sharply than most people are predicting,” he added.

The historian said that the Chancellor was unable to borrow money, “but she enormously raised taxes and she threw those taxes directly into public sector wages, which go straight into the economy”.

David Starkey slammed the Labour Chancellor

His comments come after Reeves refused to rule out tax increases this autumn, as concerns grow that Donald Trump’s trade war could harm the economy.

Speaking just a week after delivering her Spring Statement, the Chancellor told MPs that while she would not need to raise taxes on the same scale as last year, she stopped short of ruling out further hikes.

When pressed on whether she would introduce new tax rises in her next Budget, Reeves told the Treasury select committee: “I’m not going to set out four years’ worth of Budgets in advance. That wouldn’t be responsible.

“But I can assure the committee that I will not need to repeat a Budget of that scale, as we have now reset the public finances and put them on a stable footing.”

Starkey accused Reeves of mismanaging the economy by excessively taxing businesses and individuals while failing to promote economic growth.

“She is unable to borrow money, but she enormously raised taxes and she threw those taxes directly into public sector wages, which go straight into the economy,” he stated, arguing that such an approach only exacerbates inflationary pressures.

He described this policy as being founded on “Juju”, a West African belief in magic and spirits, suggesting that Reeves’ economic strategy is akin to superstition.

“I call it rain dance economics. They claim they want growth. What do they do? They increase taxes,” Starkey said, pointing out what he sees as the contradiction in Labour’s economic stance.

According to Starkey, the government's belief that state intervention will drive economic prosperity is not only misguided but potentially disastrous.

“This is bizarre. In one sense, it's economic illiteracy. I think it's something much more dangerous than that. It is that both she and Starmer believe in the state. They actually believe that the state actually shapes us,” Starkey argued.

He criticised Sir Keir Starmer’s leadership, suggesting that he prioritises state institutions over the concerns of ordinary citizens.

“Have you noticed every time Starmer is confronted by some disaster, he doesn't console the victims? First, he praises the emergency services. It's this strange idea that we are held together by the public sector rather than held back by the public sector, which is very obviously what's going on.

“At the basis of Starmer's entire outlook, you have this fundamental statism, which we know doesn't work.”

The historian also warned that the UK’s fiscal position is worsening and that Labour will likely be forced to raise taxes further.

“But the thing that's much more frightening about it is we are going steadily downhill, for borrowing is steadily increasing,” he warned.

“It is exceedingly likely there will be a need to increase taxes yet again in October. I predict you will then need to increase taxes again the following October, because actually nothing is being cut. None of the areas that really matter are actually being cut. You're simply stopping them growing.”

His comments come after Labour introduced tax rises to national insurance, removing VAT exemptions from private schools and taxing farmers’ inheritance.