UK Chancellor Rachel Reeves is facing a £40bn funding gap ahead of her upcoming Budget, far exceeding previous estimates. This shortfall stems from the need to protect key departments from cuts, cover a £22bn overspend, and build a fiscal buffer. Reeves is expected to implement significant tax rises, potentially targeting capital gains tax, non-doms, and employer national insurance contributions to meet her "golden rule" of balancing spending with tax revenues. The NHS is a top priority for new funding, and Reeves emphasized that difficult decisions on taxes, welfare, and spending are necessary for long-term growth.