US economist Arthur Laffer has warned that Labour risks "taxing Britain to death" ahead of the upcoming Budget, urging ministers to cut benefits and lower tax rates instead of pursuing further wealth taxes. His intervention coincides with Andy Burnham promoting "public control" of key industries, such as energy, water and transport, as a route to boosting growth and lowering living costs, as the Prime Minister attempts to reassure markets rattled by concerns over the UK's finances and spending commitments.

Laffer, who has advised three US presidents and devised the "Laffer curve" theory that high taxes can reduce overall revenue, said taxing workers to fund benefits for those who do not work would discourage employment, and that the priority should be creating jobs rather than paying people not to work. Chancellor John Healey and Burnham have not ruled out further tax rises, despite the tax burden already reaching record levels since Labour took office in 2024, with the Chancellor's fiscal "headroom" further squeezed by global instability, including the Middle East crisis and fears of an AI market correction, alongside pressure for higher defence spending.