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Nigel Farage has abandoned his pledges to cut tens of billions of pounds in taxes if his party wins the next election. On Monday, the Reform UK leader saidhis party could no longer promise to raise the income tax personal allowance to £20,000, and that he could only commit to “relatively modest” measures. Last year’s Reform manifesto pledged £90bn in tax cuts, including a personal allowance increase that would remove income tax entirely for seven million Britons and save workers an average of £1,500 a year. The party also said it would cancel basic rate income tax for all front-line NHS and social care staff for three years, and scrap inheritance tax (IHT) for properties worth more than £2m. However, Mr Farage said these pledges were no longer realistic and that he would only cut taxes once he had achieved substantial reductions in public spending and reassured the markets about the size of sovereign debt. Reform sources told the Telegraph that a pledge to give extra tax breaks to NHS workers was under review. ‘We want to cut taxes, of course we do’ The Reform leader, speaking at the Banking Hall in the City of London, said: “We want to cut taxes, of course we do, but we understand substantial tax cuts, given the dire state of debt and our finances, are not realistic at this current moment in time. “There are some relatively modest things we would do. We would immediately remove IHT from family farms and from family-run businesses, and we will raise the thresholds at which people start to pay tax to begin the process of getting people out of the 16 hour a week working debt trap that so many people find themselves in.” Asked to expand on his plans for tax thresholds, Mr Farage said he thought there could be an election in 2027 if the bond markets lose faith in Labour, and that “the economy will be in an even worse state than any of us in this room can even predict”. He added: “How can anybody project on pensions or thresholds, or any of those things, between now and then?” Mr Farage’s speech – his most significant intervention on the economy since he became Reform leader last year – marked a shift in his rhetoric and an attempt to portray himself as fiscally responsible. He said the markets were “getting nervy” about Sir Keir Starmer’s Government, and that Labour could be forced to deliver a “genuine austerity Budget” within two years. ‘We will substantially cut benefits bill’ Mr Farage argued that increasing the personal allowance to £20,000 – as he previously pledged – was “vital for this country” and promising to look at the £100,000 “tax trap” faced by higher earners. He also pointed to his party’s plans for spending cuts, including £9bn from the welfare budget by reducing benefit payments to Britons with mental health issues. He said: “I think we’ve just proposed the biggest benefit cuts you’ve probably ever heard any government do. And I will make this absolute promise: we will substantially cut the benefits bill. We will reduce the size of the public sector.” The speech comes ahead of Rachel Reeves’s Budget on Nov 26, when she is widely expected to freeze income tax thresholds beyond 2028. Reform UK is currently polling at an average 29 per cent of the vote – around 11 points ahead of Labour. Thanks for joining Thank you for joining The Telegraph’s live coverage of Nigel Farage’s speech on Reform UK’s vision for the economy. Here is a summary of what we learned: Nigel Farage abandoned plans for tax cuts from the previous Reform UK manifesto, declaring that “substantial tax cuts given the dire state of debt and our finances are not realistic at this current moment”.He promised that Reform would oversee “the biggest benefit cuts you’ve probably ever heard any government do” as part of plans to cut spending.The Reform leader said the party would still immediately abolish inheritance tax on family farms and family-run businesses.He expressed the ambition to raise income tax thresholds, and said it was an “aspiration” to raise the income tax starting rate to £20,000.Mr Farage reiterated his party’s plans to abolish all net zero subsidies and “get rid of the insane North Sea taxes”. Trade unions: Reform UK would ‘drag Britain into race to the bottom’ Reform UK would “drag Britain into a race to the bottom”, the trade unions’ boss has said. Paul Nowak, the general secretary of the Trades Union Congress (TUC), said: “The cat is well and truly out of the bag - Reform is the party of austerity. “Nigel Farage wants to finish what the Tories started. After 14 years of cuts that gutted our schools, hospitals and councils, he’d slash even deeper – starving our public services of vital funds.” He added: “While he’s at it, he’d drag Britain into a race to the bottom on workers’ rights, consumer and environmental standards - unleashing further chaos that would be paid for by working people.” Watch in full: Nigel Farage gives speech on the economy Farage: I want to get the income tax threshold to £20,000 Nigel Farage has said that his aspiration is to lift the income tax starting rate to £20,000 as part of a “carrot and stick approach” to getting people back to work. He said that he believed it was “vital for this country” that the rate is lifted to £20,000 but had previously said that the party would not put specific figures on the thresholds before taking stock of the state of the economy if they take power. He told journalists: “Well, I want the tax threshold to go to £20,000. I think it’s vital for this country we get it there. “It’s vital that with benefits and getting people back to work, we have incentives. I think that’s really, really important. As well as toughening of the rules, it needs the carrot and stick approach. So they were only ever aspirations. “I think what you’re seeing is us being realistic about the state of the economy,” he added. Farage vows Reform UK will raise tax thresholds Reform UK would raise the thresholds at which people start to pay tax, Nigel Farage has said. He also announced that the party would “immediately remove” inheritance tax (IHT) on family farms and family-run firms. He told a press conference in the City: “We will cut spending. We will encourage growth and entrepreneurship. “We want to cut taxes, of course we do, but we understand substantial tax cuts given the dire state of debt and our finances are not realistic at this current moment in time, there are some relatively modest things we would do. “We would immediately remove IHT from family farms and from family-run businesses, and we will raise the thresholds at which people start to pay tax to begin the process of getting people out of the of the 16-hour-a-week working debt trap that so many people find themselves in.” Asked to expand on what he would do on tax thresholds, and if this meant income tax, he told journalists: “If I’m right, and that election comes in 2027, then the economy will be in an even worse state than any of us in this room can even predict. So how can anybody project on pensions or thresholds, or any of those things between now and then?” Farage: I propose the biggest cut to benefits of any party Nigel Farage has claimed that Reform UK has proposed “the biggest benefit cuts you’ve probably ever heard any government do” as he vowed to cut the overall bill. He claimed that the party’s proposals such as reintroducing in-person appointments and reforming personal independence payments (Pip) payments, amongst others, will slash the benefits bill. He told a press conference: “In terms of benefit cuts, I think we’ve just proposed the biggest benefit cuts you’ve probably ever heard any government do. And I will make this absolute promise, we will substantially cut the benefits bill. We will reduce the size of the public sector, we will look, as we’ve already started, at public sector pensions.” Farage: I have been misunderstood on benefits policy Nigel Farage has claimed that there have been “misunderstandings” about Reform UK’s stance on benefits, and said he had only backed removing the two-child benefit cap for British working couples. He told the press conference: “There seem to have been several misunderstandings as to where Reform stands on benefits, as if we are the party that will throw around the money like confetti, based, I think, around my comments on the two child cap and removing it.” He added: “But what I said was we should remove the two child cap for British working couples. And what I meant by that is for lower-paid couples who are both working, the cost of childcare is exorbitant. “It’s a disincentive for having more children, a disincentive for going out to work and so I thought a tax credit for a couple where both were working, was actually a very, very pro-family policy in every single way.” Farage hits out at IR35 rules Nigel Farage has hit out at off-payroll working rules for small business owners and claimed that they are “stifling innovation”. He told the press conference that small businesses have “been hammered by National Insurance rules over the course of the last year, especially those working in hospitality and sectors”. The Reform leader added: “They are embattled by IR35 regulations designed by the Treasury and weak Conservative chancellors who assume that everyone out there who isn’t working for a big firm is some kind of crook. “Well, I’m sorry, but the IR35 rules are ridiculous. They’re stifling innovation. They even drive some in their fifties just to throw their hands up and go into early retirement.” Farage: Let’s get the North Sea operating Nigel Farage has said Reform UK would “get the North Sea operating” again. He said: “We will scrap all net zero subsidies. We will bring down the cost of energy. We will get rid of the insane North Sea taxes put on by Jeremy Hunt and that have been added on the top by Rachel Reeves. “Let’s get the North Sea operating. Let’s have a look at some of the new onshore gas fields that have been found in this country that will produce tens of thousands of well paid jobs.” He also declared that Reform would go further than the current Government on developing nuclear energy, criticising the amount of time and money currently required for a new plant. “Look to South Korea. South Korea, do nuclear energy, with no concessions to safety.” ‘I want as many high earning people as possible living in this country’ Nigel Farage has declared that he will reject the “hard-Left socialist dogma that it’s popular to tax the rich” and that he wants more high-earners in Britain. “This hard-Left socialist dogma that it’s popular to tax the rich, that the rich won’t move, they’ll stay and pay more, that I’m afraid has infected virtually the entirety of our political class, and it’s wrong.” He added: “So let me make it clear: I want as many high-earning people as possible living in this country and paying as much tax as they legally have to, because if the rich leave and the rich don’t pay tax, then the poorer in society will all have to pay more tax. It’s as simple as that.” Farage highlights his City credentials Nigel Farage has pointed to his previous career in the City in an attempt to bolster Reform UK’s economic credentials. He told the press conference: “Perhaps it’s appropriate that this speech is being given in this magnificent old banking hall right here in the heart of the City of London. “Now it’s a place that I know incredibly well, having spent much of my working life here, and generations of my family before me that worked here. It is a very special place, because it symbolises what is still, despite everything, Britain’s biggest industry. “We never talk about it. Parliament rarely debates it. Financial services are Britain’s biggest industry, but what sad decline we are currently in.” Britain has ‘turned its back’ on cryptocurrency and the City should embrace it, says Farage Nigel Farage has claimed that Britain is “being left behind” in the cryptocurrency boom and that the City should embrace it. He told the press conference: “We’ve totally ignored the whole new world out there, folks, it’s happening. We’re being left behind. “There’s a global boom in the trade in digital assets, in the use of stable coins, in the usage and investment in all forms of cryptocurrency. We’ve literally turned our backs on it. Both the Bank of England and the FCA [Financial Conduct Authority] have been guilty of this. “The reason the City succeeded for hundreds of years is [it is] innovative, it took risk, it saw what the future direction of markets and consumer and commercial demand would be. And we have done absolutely none of it and, frankly, I believe it’s a disaster.” Reform UK will appoint external business figures as government advisers and ministers Reform UK will appoint external business figures into government departments, Nigel Farage has declared. The party leader claimed that MPs were being appointed to departments for sectors in which they had little experience. “If we had a Parliament made up of more experienced people from a broader range of life, that may be okay. But the current convention that both parties stick with just simply doesn’t work. “In fact, frankly, you think about it, it really is a farce, isn’t it? You’re put in charge of a big department, and then after 14 months, when you’ve just about got your feet under the table, Keir Starmer, or whoever else it might be, decides to reshuffle you.” He added: “We’ll bring into government as advisers or ministers, people with real business expertise in their own sector, and we will signal what we hope and believe and what we know. “We need to have a change of attitude in this country, a change of attitude towards hard work, a change of attitude towards making money, a change of attitude towards success.” Farage: Britain is deindustrialising and losing out to China Nigel Farage said Britain is deindustrialising at a “rapid pace” and losing out to China. He said: “Just look at the pace, the rapid pace that we continue to deindustrialise. It’s all going: chemicals, refining, cement, heavy engineering, steel. We’re losing literally all of it. “And China [is] the beneficiary in almost every single sector. Why? Because, for ideological reasons, we have chosen to have the most expensive industrial energy prices in the world.” Rachel Reeves will be forced into austerity Budget by the markets, claims Farage The Chancellor will be forced into delivering “a genuine austerity Budget” within months and the Left of the Labour Party will revolt, Nigel Farage has claimed. The Reform UK leader said that he believed this would cause Sir Keir Starmer to call a general election in 2027 as a result of “economic collapse”. He told the press conference: “The markets are getting nervy. We’ve seen this with 10 and 30-year gilt yields. In fact, I think my own view is that in two budgets’ time, the markets will actually force the Chancellor into what will be a genuine austerity Budget. “At which point the Left in the Labour Party won’t buy it. And it’s why I still stand by my prediction that there will be a general election, caused by economic collapse that will happen in 2027.” Farage: We have been ‘living under an illusion for years’ Britain has been “living under an illusion” about its economic prosperity for some years, Nigel Farage has said. He told a press conference in the City: “I think for some years we’ve actually been living under an illusion. We’ve not been prepared to face up to just how much of an economic mess we’re genuinely in. “As we slip down the global league tables, we kid ourselves. ‘Well, it’s okay we’ve got GDP growth.’ “But there wouldn’t have been any GDP growth over the course of the last few years if it wasn’t for mass migration on a scale hitherto never even contemplated.” Farage will be ‘champion of the strivers and grafters’, says Yusuf Nigel Farage will be the “champion” of the workers as prime minister, Zia Yusuf has vowed. He told the press conference: “Despite the best efforts of the political class, we still have an awful lot going for us in this country. “Three of the top 10 universities on the planet are here on these little islands. We have more than our fair share of brilliant people in this new era. “We also have millions upon millions of strivers and grafters, men and women who set their alarm clocks before they go to bed, and rise early in the morning to go to work. “I promise you this as prime minister, Nigel Farage will be their champion.” Zia Yusuf: Tories and Labour have wrecked public finances Zia Yusuf has opened the press conference on the economy by blaming both Labour and the Conservatives for damaging Britain’s finances. The policy chief of Reform UK called the cost of living “intolerable” and took particular aim at energy prices. He told the press conference: “The Tories and Labour have wrecked the public finances. Reform UK will restore them. “For decades now, the Tories and Labour have suffocated the British economy, wasted billions of pounds every year prioritising foreign citizens, giving us the most expensive energy costs in the world and raising taxes as a percentage of GDP in this country to the highest levels since World War Two.” He added: “The political class are running this country’s economy off a cliff. Britain is headed for economic catastrophe unless we urgently change course.” Analysis: Inside Reform UK’s press conference I’m at Nigel Farage’s speech in the Banking Hall, an events space over the road from the Bank of England, in the heart of the City of London. This is home turf for the Reform UK leader, who made his fortune as a commodities trader in the City before becoming a politician. Privately, Mr Farage often talks about the great and the good from the British business community, with whom he often has personal relationships. The interesting thing about this event is the audience. To ambient classical music, I’ve seen representatives from three of the UK’s biggest business lobbying agencies swanning around and networking. Two public affairs pros told me that their clients are now interested in engaging with Reform and trying to shape their manifesto ahead of the next election. That’s unusual for an opposition party with three MPs, four years before a general election. Frustration with the “basket case” Government seems to be driving it. As usual at these press conferences, Reform has also invested in the catering budget, with coffee and pastries for guests and hacks. Mr Farage is due to take the stage imminently. Labour: Farage would take us back to austerity Nigel Farage’s plans for the economy “would take us back to austerity”, Labour has claimed. A party spokesman pointed to councils controlled by Reform UK and claimed that they have “ failed to deliver the savings they already promised and are cutting services and raising taxes as a result”. They said: “Nigel Farage says he is offering something new – but for all his talk, his plan would take us back to austerity.” The spokesman added: “They’ve said themselves that those councils are a shop window for what a Reform government would do nationally – we know that this is more empty promises and no real plan.” What did Reform promise in its previous manifesto? Reform UK had promised a range of economic policies in its 2024 manifesto. They pledged to raise the minimum income tax threshold from £12,571 to £20,000, which would have exempted six million people from having to pay income tax. They also set out plans to raise the higher 40p rate threshold from around £50,000 to £70,000. They also promised to abolish inheritance tax on all estates worth under £2m. Nigel Farage is expected to distance himself from many of these economic pledges and provide a fresh economic vision from Reform. Farage: ‘We are the pro-business party’ Reform is the “pro-business party” of UK politics, Nigel Farage will claim. The party leader is set to vow that he will “reduce the size of the bloated state” and “bring expertise into the government” should Reform win the next election. He will say: “We are the pro-business party. Without thriving businesses, there are no great jobs.” Mr Farage is also expected to blame a “political class who were not business people” and the fact Britain is “led by human rights lawyers, not entrepreneurs”. Nigel Farage to give press conference on his vision for the economy at 11am Nigel Farage will shortly give a press conference in central London ruling out tax cuts until public spending has been reduced if Reform wins the next election. The party leader will attempt to build his economic credibility and reassure voters that Reform can be trusted to manage the economy. Reform went into the last election with a pledge to cut taxes by £90bn, including lifting the income tax starting rate from £12,500 to £20,000 a year and scrapping inheritance tax on estates worth less than £2m.
