Healey urged to raise taxes on £38,000 earners for defence budget

Chancellor John Healey has been urged to tax middle earners to fund Labour's defence spending commitments in the October Budget, according to a new Resolution Foundation report. The think tank says raising £28bn a year for defence requires higher taxes on average workers, noting UK taxes on middle earners remain low internationally. A worker earning £38,000 faces a lower tax burden than most OECD peers. The report highlights that UK average earnings of £56,000 exceed median full-time pay of £39,000. Despite recent National Insurance rises, the UK's tax wedge remains below the OECD average and historically low.