Fixing the Economy: Tax Cuts or Spending Cuts?
Britain’s economy is stuck in a rut. The Legacy Parties of Labour and the Conservatives solution is to cancel elections. What are the real world solutions?
Britain’s economy is stuck in a rut. Taxes are at their highest sustained level in modern history, national debt is uncomfortably high, and growth is weak. For millions of working people, the result is obvious: less money in their pockets, higher bills, and a growing sense that the system is rigged against those who work hard and play by the rules.
The political establishment tells us there is no alternative — that high taxes and high spending are simply the price of a “modern economy”. But that thinking is exactly what has landed Britain in trouble.
The High-Tax, High-Debt Status Quo
The UK tax burden now sits at around 37–38% of GDP, close to its highest level since the Second World War. At the same time, public debt remains close to 100% of GDP, leaving the country dangerously exposed to higher interest rates and future shocks.
Despite this, the public is not getting better services. The NHS struggles, local councils waste money, infrastructure projects overrun by billions, and productivity remains stubbornly low. High taxes are not buying high performance — they are funding inefficiency.
This is the core problem: Britain taxes too much and spends badly.
A Different Approach: Cut Waste, Reward Work
Reform UK argues that fixing the economy starts with honesty. You cannot grow an economy by endlessly raising taxes on workers and businesses. Nor can you borrow forever without consequences.
Reform’s approach is clear:
Reduce taxation so that work, saving, and enterprise are rewarded
Cut wasteful government spending rather than frontline services
Shrink the state’s footprint so the private sector can grow
One flagship proposal is to trim around £50 billion from government budgets, targeting waste, duplication, failed projects, and areas where the state has expanded far beyond what is necessary. This is not about austerity for its own sake — it is about value for money and restoring discipline.
Raising the Personal Allowance: Let People Keep What They Earn
A central Reform proposal is to raise the income tax personal allowance from £12,570 to £20,000.
This would be transformative.
Millions of low- and middle-income workers would keep thousands more of their own money each year. It would:
make work pay
help people escape the low-hours, low-wage trap
boost spending in local economies
reduce reliance on in-work benefits
Crucially, this is not a handout. It is allowing people to keep what they earn — the most direct and dignified form of tax relief.
Tax Cuts Alone Are Not Enough
Critics often ask: “How can we afford this?” It’s a fair question — and one the political class often dodges with fantasy numbers.
Reform’s answer is balance.
Tax cuts must go hand in hand with spending reductions and pro-growth reforms. That means:
stopping wasteful programmes that deliver little public benefit
reforming bloated bureaucracies
ending blank-cheque spending with no accountability
focusing the state on essentials, not micromanagement
Lower taxes also help drive growth. When businesses invest more and workers keep more of their earnings, the tax base expands naturally. Growth, not ever-higher tax rates, is how public finances are ultimately repaired.
Small Government, Big Growth
Britain does not have a lack of talent, ambition, or creativity. What it has is a government that takes too much, spends poorly, and regulates excessively.
A smaller, smarter state — combined with lower taxes and disciplined spending — is the route to higher growth, higher wages, and a more confident country.
The choice is clear. Stay on the current path of high taxes, high debt, and low growth — or take a new direction that trusts people, rewards work, and backs enterprise.
Reform UK is arguing for the second path. The real question is whether Britain is ready to take it.