Rachel Reeves has said that “main taxes on working people” will not rise in the Budget. She gave the reassurance a week before she delivers her first Budget, and the first by a woman Chancellor. But her words left the door open to a raft of other tax rises, many of which could hit London hard.

High borrowing costs and public sector pay rises have given chancellor Rachel Reeves a £6.7bn headache ahead of next week’s Budget. Borrowing in the first six months of the year stood at £79.6bn, £1.2bn higher than a year earlier and almost £7bn higher than the Office for Budget Responsibility watchdog – which monitors the state’s finances – had estimated.

Reeves facing £16.6bn peak in UK borrowing due to public sector pay rises - Speculation is mounting ahead of 30 October

Public sector pay rises have helped fuel a surge in Treasury borrowing as Rachel Reeves scrambles to fill a £40bn black hole in public finances. Public sector net borrowing excluding banks stood at £79.