OBR challenges claims Reeves dropped income tax rise due to rosier forecasts

Official forecaster’s chair says chancellor knew about revised predictions well before her budget change of heart

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The Office for Budget Responsibility (OBR) has cast doubt on claims Rachel Reeves dropped plans to raise income tax in this week’s budget because of rosier forecasts, pointing out she knew about these well before the change of heart.

In a move likely to exacerbate tensions with the Treasury, the OBR chair, Richard Hughes, has taken what he acknowledged was the “unusual step” of writing to the Treasury select committee to explain how its forecast evolved, “given the circumstances in this case”.