The government has announced, "Taxes will be raised":

In changing the given sentence from direct speech to indirect speech, we need to follow the rules of reported speech. Here, the reporting verb is "has announced," and we need to adjust the sentence accordingly:

The original sentence is in direct speech: "The government has announced, 'Taxes will be raised.'"

In indirect speech, the reporting verb "has announced" remains the same, and the sentence is converted to report the statement made by the government. When reporting statements about future events, we generally change the tense of the reported speech verb from "will" to "would" to make it indirect. So, "will be raised" becomes "would be raised":

So, the correct transformation is: Option A: The government has announced that taxes would be raised.