Politics
Increases to national insurance and income tax ruled out under Labour – as Reeves promises cash ‘injection’
Labour has ruled out increasing income tax or national insurance if they were to win the election.
Shadow chancellor Rachel Reeves said she and Labour leader Sir Keir Starmer want to lower taxes for working people but she would not put forward “unfunded proposals”.
Ms Reeves said: “None of our plans require increasing taxes.”
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She also said she did not want to make public spending cuts. However, she could not give guarantees and said there would have to be a spending review if she was in charge of the Treasury.
She said: “We want taxes on working people to be lower and we certainly will not be increasing the rates of income tax or National Insurance, and that applies to all the bands of income tax.
“We would like taxes on working people to be lower, but unlike the Conservatives I would never make pledges that are not fully costed and fully funded.
“It’s only by having pledges that are fully costed and fully funded that people can actually believe what you’re going to say.”
She refused to say when Labour would increase defence spending to 2.5% of GDP, as promised, but said it would happen “as quickly as possible”.
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Ms Reeves earlier promised there is “not going to be a return to austerity” under Labour and would boost frontline services with a “down payment on the changes that we want to make”.
“But in the end, we have to grow the economy, we have to turn around this dire economic performance,” she told the BBC’s Sunday With Laura Kuenssberg programme.
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The shadow chancellor said there would be an “immediate injection” of cash into public services – for the NHS, more police and more teachers.
That would be funded by ensuring those with non-dom status “pay their fair share of tax” and cracking down on tax avoidance, she argued.
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Labour would also place VAT and business rates on private schools “to recruit 6,500 additional state school teachers”, she said.
And she insisted Labour “will end fire and rehire”, where companies sack their staff and then bring them back on worse contracts.
The Unite union had criticised Labour for excluding an outright ban on the practice but Ms Reeves said: “We will not allow that to happen.”