The United Kingdom’s departure from the European Union has inflicted deeper damage on the country’s economy than previously estimated, Chancellor of the Exchequer Rachel Reeves stated during a regional investment summit in Birmingham.

Reeves noted that the combined effects of austerity measures following the financial crisis, reduced capital investment, and Brexit itself have weighed heavily on economic performance. “These factors have had a far greater impact than anticipated at the time. That is why we are working to restore and strengthen our relationship with the European Union, aiming to alleviate some of the costs that have been unfairly imposed on businesses since 2016 and the formal exit a few years ago,” she said, according to The Guardian.

British media outlets have reported that Reeves plans to unveil a series of tax increases in her upcoming November budget, responding to the ongoing economic challenges. Sources indicate that the Labour government intends to point to Nigel Farage, leader of the prominent right-wing populist party Reform UK and a key architect of Brexit, as partly responsible for these measures.

The decision for the UK to leave the EU was made via a referendum on June 23, 2016, in which 51.9% of voters supported Brexit, while 48.1% opposed it. After extensive negotiations, the UK formally exited the EU on February 1, 2020.

The post-Brexit transition period, during which European regulations continued to apply in the UK, ended on January 1, 2021. A deal on future relations was finalized in December 2020, establishing a free trade area covering goods and services without quotas or tariffs.