Now high earners are in Labour’s tax crosshairs: Minister refuses to say if pledge not to hammer ‘working people’ includes the better paid – with fears ‘stealth’ raid will drag another 600,000 into higher tax rates_Nhy
A minister dodged on whether bigger earners count as ‘working people’ today after Wes Streeting hinted they will be hammered with Budget tax hikes.
Care minister Stephen Kinnock repeatedly refused to answer as he was grilled over whether the protection Labour promised at the election extended to those making six figures.
The party ruled out increases in the main rates of income tax before winning power, but Chancellor Rachel Reeves is expected to bring forward a host of other measures to punish wealthier Brits.
Asked on Sky News whether people who earned more than £100,000 a year are ‘working people’ – and might therefore benefit from protection under Labour’s definition – Mr Kinnock merely said: ‘We made it absolutely clear that we won’t be raising taxes on working people, that means VAT, National Insurance and income tax.’
Care minister Stephen Kinnock repeatedly refused to answer as he was grilled over whether the protection Labour promised at the election extended to those making six figures
It has emerged that Ms Reeves is likely to extend the freeze on tax thresholds beyond the current end date of 2028.
The IFS think-tank has estimated that the move will bring 600,000 more people into the higher and additional rates of tax by 2029.
That would mean numbers paying the 40p rate – which applies on earnings between roughly £50,000 and £125,000 – topping 3million for the first time.
In a round of interviews yesterday, Health Secretary Mr Streeting said he was not worried about people earning six figures.
‘When I’m thinking about this budget and its consequences, I’m actually not thinking about people on my salary or your salary,’ he told Sunday Morning with Trevor Phillips on Sky News.
‘I’m thinking about people like my mum, who’s a cleaner, or my dad, who’s a car salesman.
‘People who are on lower or middle income who get towards the end of the month and find they’ve got more month left than they have the money.’
Mr Streeting, who earns £159,000 as an MP and Cabinet minister, added: ‘I am not worried about me, I am not worried about you, but I am worried about people who are struggling to make ends meet at the moment.’
Fears are mounting that Ms Reeves will impose one of the biggest tax hikes in history at the Budget.
The respected IFS think-tank has warned that Ms Reeves needs to find around £25billion of increases on October 30 if she wants to avoid austerity and meet Labour’s manifesto commitments.
Fears are mounting that Ms Reeves will impose one of the biggest tax hikes in history at the Budget
In a round of interviews yesterday, Health Secretary Mr Streeting said he was not worried about people earning six figures
However, other analysts have suggested the total could be even higher at £30billion. And Treasury sources have been briefing that the ‘black hole’ in the books could require £40billion of tax rises and spending cuts.
But there have been signs of growing anxiety within government over how to find the cash from already-struggling Brits.
With the Treasury now in the ‘tunnel’ of wrangling with the OBR watchdog, there have been jibes about ‘disarray’.
Rumours have been circulating that manifesto measures such as imposing VAT on private school fees and cracking down on non-doms will not bring in as much as hoped.
And having ruled out changes to headline income tax, VAT and national insurance rates, the Chancellor could be left relying on an array of smaller raids – the effects of which can be very hard to predict.
