Minister hints at tax hikes for middle class

Labour has left the door open to higher taxes on the middle classes in Rachel Reeves’s crunch Budget later this year.

Transport secretary Heidi Alexander would not rule out tax rises in a series of interviews on Sunday morning, but said the government had pledged not to hike them for “people on modest incomes”.

Asked if the public should expect taxes to go up in the autumn, she said ministers would be guided by “fairness”.

She also told Sky News’s Sunday Morning With Trevor Phillips programme that cabinet ministers did not “directly” talk about the idea of a wealth tax – being pushed by unions and former Labour leader Lord Neil Kinnock – during an away day at the prime minister’s Chequers country estate this week.

The shadow home secretary, Chris Philp, said her comments “sound to me like a barely disguised reference to tax rises coming in the autumn”.

It comes as Ms Reeves’s strategy for economic growth appears in tatters after the Federation of Small Businesses said that for the first time, more small firms expect to shrink than grow.

The FSB found 27 per cent expected their firm to become smaller or close over the next 12 months, while just 25 per cent predicted it would expand.

The chancellor has refused to rule out tax rises at the Budget since Labour MPs forced ministers to make a U-turn on welfare reforms, losing the government an estimated £5bn a year in savings.

She is under intense pressure to find more money after the Office for Budget Responsibility (OBR) this week warned that the UK’s finances are on an “unsustainable” path that the government “cannot afford” in the longer term.

On Wednesday, Sir Keir Starmer failed to rule out extending “stealth taxes” – as well as the introduction of a wealth tax – as his government struggles to balance the books.

The prime minister reiterated that Labour would stick to its manifesto pledge and ruled out increases to income tax, VAT and national insurance, but he did not confirm whether the government was planning to lift the freeze on income tax thresholds in 2028.

The freezes mean more and more people are dragged into paying higher rates of income tax every year as the thresholds fail to keep pace with inflation.

Lord Kinnock last week suggested a wealth tax would bolster the public finances without breaking Labour’s pledges.

Union leaders, including Sharon Graham of Unite, are also pressuring ministers to consider the move.

Asked by Sky News if such a tax had been discussed at the cabinet away day on Friday, Ms Alexander said: “Not directly at the away day.”

Pressed on what she meant by not directly, the senior minister replied: “I think your viewers would be surprised if we didn’t recognise that, at the Budget, the chancellor will need to look at the OBR forecast that is given to her, and will make decisions in line with the fiscal rules that she has set out.

“We made a commitment in our manifesto not to be putting up taxes on people on modest incomes, working people. We have stuck to that.”

Asked again if this meant there will be tax rises in the Budget, Ms Alexander replied: “So, the chancellor will set her Budget. I’m not going to sit in a TV studio today and speculate on what the contents of that Budget might be.

“When it comes to taxation, fairness is going to be our guiding principle.”

Trump crashes Chelsea’s trophy lift after Club World Cup final triumph

US president Donald Trump astoundingly crashed Chelsea’s trophy celebrations following their stunning Club World Cup final victory over PSG.

Trump, who watched the game at New Jersey’s MetLife Stadium alongside Fifa president Gianni Infantino, made his way down to the pitch to present Blues captain Reece James with the trophy.

But instead of following Infantino out of shot, Trump locked his feet in position and stayed front and centre as James held the trophy aloft, with his Chelsea teammates left with no option but to celebrate around the president.

It was a bizarre decision from the leader of the free world, who went against the usual protocol of letting the team enjoy the moment with each other and instead opted to remain the centre of attention.

Chelsea’s players looked largely unbothered by Trump’s involvement but a handful expressed their confusion, with James and Palmer among those looking bewildered.

“It’s a big thing [competition], Gianni’s a friend of mine. But it’s great to watch,” Trump told DAZN. “This is a little bit of an upset we’re watching today. [Fifa has done] fantastically well, it’s a growing sport, it’s a great sport.”

The Blues battled against all the odds to stun European champions PSG in the final, dispatching Luis Enrique’s side in an incredible 3-0 victory.

Cole Palmer stole the show, netting the opening two goals with identical finishes before setting up Blues new boy Joao Pedro, who made it three goals in as many appearances with a cheeky dink past Gianluigi Donnarumma.

Chelsea ended the game with a further numerical advantage as PSG midfielder Joao Neves was sent off for pulling Marc Cucurella’s hair.

Enzo Maresca’s side have now gone down in history as the first team to win the revamped Club World Cup, lifting the unique trophy aloft in front of a giant inflatable replica.

The Fifa Club World Cup was shown on DAZN. Sign up here now.

King Charles to host Trump at Windsor during second state visit

Buckingham Palace has confirmed that Donald Trump will be hosted by the King and Queen at Windsor Castle during his unprecedented second state visit to the UK in September.

The US president will be accompanied by his wife, first lady Melania Trump, on his three-day visit to the UK, scheduled for 17 to 19 September.

This will be Mr Trump’s second state visit – an unprecedented gesture towards a US leader following his previous state visit in 2019.

The House of Commons will not be sitting at the time of Mr Trump’s visit as it will be in recess for party conference season, meaning the president will not be able to address parliament as French President Emmanuel Macron did during his state visit last week. The House of Lords, however, will be sitting.

In February this year, Sir Keir Starmer presented the US president with a letter from the King as he invited him for the visit during a meeting at the White House.

As the pair sat next to each other in the Oval Office, Sir Keir handed the president the personal invitation, later saying, “this is truly historic and unprecedented”.

After reading it, Mr Trump said it was a “great, great honour”, adding “and that says at Windsor – that’s really something”.

In the letter, Charles suggested that he and the president might meet at Balmoral or Dumfries House in Scotland first before the much grander state visit.

However, it is understood that, although all options were explored, there were logistical challenges surrounding an informal visit, with complexities in both the King and Mr Trump’s diaries meaning a private meeting was not possible over the course of the summer months.

Precedent for second-term US presidents who have already made a state visit is usually tea or lunch with the monarch at Windsor Castle, as was the case for George W Bush and Barack Obama. The late Queen hosted Mr Trump during his first state visit.

News of the plans for the September visit comes days after the King wrote to Mr Trump to express his “profound sadness” after flooding killed more than 90 people in Texas.

Charles “offered his deepest sympathy” to those who lost loved ones over the July Fourth weekend, the British embassy in Washington DC said.

In March, Mr Trump sent the King his “best wishes” and “good health” in a phone call with Sir Keir after Charles spent a brief period in hospital after experiencing temporary side effects from his cancer treatment.

The September state visit comes after Charles visited Canada in May, where he opened the nation’s parliament.

Many Canadians saw the King’s two-day visit to Ottawa as a symbol of support for the country that has faced the unwanted attention of Mr Trump’s trade war against his neighbour and threats to Canada’s independence.

This week, French president Emmanuel Macron and his wife Brigitte were hosted by the King and Queen during his three-day state visit.

Mr Macron’s itinerary included a glittering state banquet at Windsor Castle, a carriage ride through the historic Berkshire town and a ceremonial welcome.

The state dinner was attended by the Queen, the Prince and Princess of Wales, the prime minister and senior members of the cabinet.

Bank of England ‘could cut interest rates if jobs market slows’

The Bank of England could make cuts to interest rates if the jobs market slows down, Andrew Bailey has said.

Businesses are “adjusting employment” as a result of Chancellor Rachel Reeves’ decision to raise national insurance contributions (NICs) for employers, the governor of the Bank also told The Times.

Companies are “also having pay rises that are possibly less than they would have been if the NICs change hadn’t happened”, Mr Bailey said.

In an interview with the newspaper, the governor said the British economy was growing behind its potential.

This could open up “slack” to bring down inflation, he said, meaning prices on goods would rise less swiftly compared with earnings in future.

Mr Bailey said he believes the base rate set by the Bank of England would be lowered in future, after it was held in June.

The current Bank rate of 4.25 per cent which has a bearing on all lending in the UK – including mortgages – will be reviewed again on 7 August by the Bank’s Monetary Policy Committee.

“I really do believe the path is downward,” Mr Bailey told The Times.

He added: “But we continue to use the words ‘gradual and careful’ because… some people say to me ‘why are you cutting when inflation’s above target?’”

The governor’s indication that lower lending rates and reduced inflation could be around the corner comes as the government is facing pressure to improve living standards.

Ms Reeves’s tax and spend plans are also being constrained by the current borrowing costs, as well as downgraded growth forecasts.

The chancellor’s fiscal headroom has been in part eroded by U-turns on the winter fuel payment and welfare reforms, as well as global shocks to the British economy.

Some in the Labour Party, including former leader Lord Neil Kinnock and Wales’s first minister Baroness Eluned Morgan, are calling for a wealth tax to help bolster the public finances.

On Sunday, transport secretary Heidi Alexander said such a tax had not been “directly” discussed when ministers held an away day at the end of last week.

But speaking to Sky News’ Sunday Morning With Trevor Phillips programme, she would not rule out tax rises at the autumn budget, only saying tax decisions would be made based on “fairness”.

England thrash Wales before an unspoken boost ignites Euro 2025 hopes

“I think we’re in a good place,” Sarina Wiegman said of this 6-1 win over Wales. That might not just apply to the performance.

Although this was the biggest win of Euro 2025 so far, the victory that might have been most significant for England on the night was perhaps in Basel. France’s 5-2 comeback win against the Netherlands ensured Wiegman’s team finished second, to go into what looks like the more forgiving side of the draw.

Sweden of course offer a very tough quarter-final – especially after their own statement display against Germany – but there’s no Spain there. It’s much less open. The cheers that greeted the announcement of second place said enough.

Wiegman wouldn’t be drawn on any of that, refusing to speak on the luck of the draw. “In tournaments, it’s really tricky to think we want to go that way… you just try to win every game.”

England’s win pretty much emphasised that she doesn’t allow that kind of thinking.

Although it was seen as an almost foregone conclusion that they would claim the victory that would put them through the group, there was no hint of complacency. There was only a side that seemed intent on laying another marker, making a huge stride after downing Netherlands 4-0.

England were ahead after just 13 minutes, Georgia Stanway scoring a penalty after she was brought down by Carrie Jones. It could have been even earlier, too, except the decision went through a lengthy VAR check.

After that, the night was pretty much over as any kind of tension-filled sporting contest, but not as an occasion.

One of the loudest moments of the match was when substitute Hannah Cain smashed in that 75th-minute strike, to give Wales the one thing their fans wanted out of the game: a goal. Before the match, many had been happily talking about how their tournament debut had been a hugely enjoyable learning experience, with their executives satisfied that it had already had a significant impact on women’s football in the country.

“They are groundbreaking in what they’re doing,” Wales manager Rhian Wilkinson stated, although she added: “There’s a fitness gap”.

They pretty much all said they would just love that one goal against England – especially if they couldn’t quite dream of knocking them out – to really cap it off.

They got it, but it was also one of the goals of the tournament. Team star Jess Fishlock surged forward before slipping through a fine through ball, the elegance of the pass contrasting exquisitely with the way Cain drove it into the top corner first time.

It was a cheer that became louder than the stirring singing of “The Land of My Fathers” before the game.

As they celebrated, the English players looked properly aggravated at conceding the goal. There was certainly no sense of this just being nice for their defeated neighbours.

It speaks to the attitude Wiegman has distilled in them since that opening defeat to the French. “We didn’t have a good start against France but that gave us the urgency to do things better,” she said. They immediately went about trying to make it the actual biggest win of the tournament, by seeking to score the sixth.

Aggie Beever-Jones eventually got it with a close-range header, to also ensure that there were six different scorers for England. Such variety was one of many satisfying elements to the game, even allowing for the forgiving nature of the opposition.

Of those goals, Alessia Russo’s felt the most meaningful, given that England’s tireless number-nine finally opened her account. That will only help a tournament where she has put in some selfless displays.

Stanway, meanwhile, looked so much sharper than she did even a week ago. Beside her, Keira Walsh was imperious. It became all the more obvious that, to stop England, you stop Walsh. That is a thought for Thursday, though, and that quarter-final against Sweden.

Sweden will themselves have to think about Lauren James, who Wiegman said was “much more relaxed”. It told. She was enjoying herself.

Around it, Ella Toone scored from a slightly different tactical position to the Dutch match, with the ousted Beth Mead coming on to score the fifth. Lauren Hemp had made it four, another close-range goal that only spoke to England’s dominance.

When it was announced after the game that France had won 5-2, and Wiegman’s side consequently finished second, there were almost cheers from the England end to match Wales’ goals.

The manager won’t say it, but everyone knows how important it is. Even before you get to Spain, that side of the draw is seen as more congested, with more quality.

England don’t have to worry about that for now. They just have to worry about Sweden, which is a big test of its own.

They at least go there with the biggest win of the tournament so far, one thing that they do have over Spain.

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Most people in France, Germany, Italy and Spain want UK to rejoin EU, poll finds

Most people in the four largest countries in the European Union would welcome the UK back into the bloc, a new poll has found – but not on the same terms it had before.

At the same time most Britons are in favour of rejoining the EU, the YouGov survey of six western European nations found, but only if they can keep the opt-outs the UK previously had, such as remaining outside the Schengen zone and keeping its own currency.

The results come just days after Sir Keir Starmer welcomed French president Emmanuel Macron to the UK for the first state visit from an EU leader since Brexit.

The Labour leader has said he wants to fix Britain’s damaged relationship with the European Union for the benefit of “generations to come”.

Now, 10 years after MPs voted to hold the referendum that led to Britain leaving the EU, the poll found that at least half of people asked in France, Germany Italy and Spain, supported the UK being allowed to rejoin, a range that spanned from 51 per cent support in Italy to 63 per cent in Germany.

But the pollster said the results revealed a “public opinion impasse”.

Asked if Britain should be allowed to return on the same conditions as when it left, support fell.

Just one in five across the four countries, from 19 per cent in Italy and France to 21 per cent in Spain and 22 per cent in Germany, agreed, with more than half, 58 to 62 per cent, saying the UK must be part of all of the EU’s main policy areas.

In the UK, 54 per cent supported rejoining the EU, but that number fell to 36 per cent if it meant giving up previous opt-outs. If that was the case, 45 per cent said they opposed returning to the EU.

The final European country polled, Denmark, one of three member states to hold significant opt-outs itself, was more enthusiastic about allowing UK to keep its previous opt-outs, a stance 43 per cent of people said they backed.

The official Office for Budget Responsibility estimates that the size of the UK economy will be four per cent smaller over the long term than it would have been without Brexit.

The Independent also revealed earlier this year that Brexit has created a “mind-blowing” nearly two billion extra pieces of paperwork for businesses – enough to wrap around the world 15 times.

Magnitude 6.8 earthquake hits Indonesia’s Tanimbar Islands region

An earthquake of 6.8 magnitude struck the Tanimbar Islands chain in southeastern Indonesia on Monday, the German Research Centre for Geosciences (GFZ) said.

No tsunami threat has been issued so far after the earthquake struck at a depth of 10km (6.21 miles), GFZ said.

In January 2023, a powerful 7.6 magnitude earthquake off the Tanimbar islands set off a tsunami warning for hours, panicking residents. The quake caused damage to at least 15 homes and two school buildings with no loss of life reported.

The Tanimbar Islands are a group of around 30 islands located in eastern Indonesia, within the Maluku province. They lie in the Arafura Sea, between Timor to the west and New Guinea to the east.

Indonesia, a nation of more than 270 million people spread across an archipelago, sits along the Pacific “Ring of Fire” – a zone of intense seismic activity. The country is home to 120 active volcanoes and frequently experiences earthquakes, eruptions and tsunamis.