Minister leaves open prospect of middle-class tax grab
A senior Labour minster has left open the prospect of raising taxes for middle-class workers in the autumn budget later this year.
Transport Secretary Heidi Alexander told Sky News’ Sunday Morning with Trevor Philips that the government had pledged not to raise taxes for “people on modest incomes.”
Responding to questions on whether fresh tax hikes would be announced in October, Alexander said the government’s “guiding principle” would be “fairness.”
“I think your viewers would be surprised if we didn’t recognise that at the Budget the Chancellor will need to look at the OBR (Office for Budget Responsibility) forecast that is given to her and will make decisions in line with the fiscal rules that she has set out.
“We made a commitment in our manifesto not to be putting up taxes on people on modest incomes, working people. We have stuck to that.”
Ministers have refused to rule out introducing a wealth tax after former Labour Party leader Neil Kinnock and a host of union bosses came out in favour of the idea earlier this month.
There is concern such a policy would accelerate the depature of Britain’s wealthy elite, many of whom have already packed their bags following changes to non-dom tax rules.
Alexander told Sky News that cabinet ministers did not “directly” discuss a wealth tax this week during an away day at Prime Minister Keir Starmer’s Chequers Court country house in Buckinghamshire.
Chris Philp, shadow home secretary, said the transport secretary’s comments “sound to me like a barely disguised reference to tax rises coming in the autumn.”
He argued tax hikes were under discussion due to a shrinking economy, higher unemployment than when Labour took power and because the government had “completely failed” to reform welfare.
He added: “They can’t get anything past their own back benches. The consequence of all of that is going to be tax rises for people who are working hard and on businesses.
“It’s nothing to do with fairness, it’s a symptom of Labour failure.”