Sir Keir Starmer says those with assets are ‘not working people’ – paving way for possible tax rises
Sir Keir Starmer has hinted at possible tax rises for those who own shares and assets, saying they do not fit his definition of “working people”.
The prime minister was asked to share his definition of a “working” person after Labour’s election-winning manifesto promised “not increase taxes on working people” – but who exactly that covers has not been entirely clear.
The debate over the definition intensified after ministers refused to rule out raising national insurance on employers in the budget – which tax experts believe would ultimately be passed on to employees and workers – for example, through lower wages.
Sir Keir said he believed a working person was somebody who “goes out and earns their living, usually paid in a sort of monthly cheque” but they did not have the ability to “write a cheque to get out of difficulties”.
Asked by Sky News’ political editor Beth Rigby whether he would classify a working person as someone whose income derived from assets, such as shares or property, the prime minister said: “Well, they wouldn’t come within my definition.”
Politics latest: Tories accuse government of ‘broken promises’ over budget rule change
Pressed on whether that meant taxes for those people could go up, the prime minister said: “You can probably give me any number of examples… you’re asking me for a definition of who’s a working person, and then you’re making assumptions about what that tax might be in relation to.”
Inheritance tax, charged on the estate of someone who has died, and capital gains tax, imposed on the profit from the sale of capital assets, have been touted as the two most likely to see a rise.
Capital gains tax is currently levied on most personal possessions worth £6,000 or more, including second homes, most shares not held in an ISA and business assets.
Rachel Reeves, the chancellor, has refused to rule out increasing them, saying in August: “On spending, on welfare, and tax, we’re going to have to make a series of difficult decisions, but I’ll set out that detail in the right and proper way on the 30 October at that budget.”
Both Sir Keir and Ms Reeves have repeatedly warned that “tough” decisions lie ahead in the budget after it claimed to have uncovered a £22bn black hole in the nation’s finances left by the previous government.
According to people close to the budget, the gap in funding identified by the chancellor is more than twice what was previously thought – at £40bn.
The chancellor admitted on Thursday she would rewrite the government’s fiscal rules in next week’s budget to allow her to increase borrowing for public investment by around £50bn.
Read more:
What are Labour’s fiscal rules
Apology for slave trade ‘not on the agenda’, says No 10
Speaking to Sky News in Washington DC, the chancellor said the self-imposed rule under which borrowing must be falling by the fifth year of economic forecasts will be redefined from the current measure of public sector net debt.
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Chancellor to rewrite fiscal rules
She insisted the change was necessary to end years of declining public investment and deliver on Labour‘s promise to deliver growth.
“Under the plans that I have inherited from the previous Conservative government, public sector net investment as a share of our economy was due to decline steeply during the course of this parliament,” she said.
“I don’t want that path for Britain when there are so many opportunities in industries from life sciences to carbon capture, storage and clean energy to AI and technology, as well as the need to repair our crumbling schools and hospitals.”
Crystal Palace are celebrating a historic win in the FA Cup after a 1-0 victory against Manchester City at Wembley.
It’s the south London club’s first major trophy – and third time lucky after losing two previous finals they have played in. The win also means Palace have qualified for next season’s Europa League.
Eberechi Eze put his side 1-0 up with the game’s only goal in the 16th minute.
Man City were given a chance to equalise when they were awarded a penalty in the 33rd minute, but Palace goalkeeper Dean Henderson – who had earlier escaped a red card for a handball outside the box – saved Omar Marmoush’s spot kick.
Crystal Palace’s Eberechi Eze scores. Pic: PA
Man City’s Omar Marmoush after his penalty was saved. Pic: PA
It briefly seemed the south London team had gone 2-0 up after a 58th-minute strike from Daniel Munoz but the goal was quickly ruled offside.
They then held onto their 1-0 lead until the final whistle, which came after an agonising 10 minutes of injury time.
Dean Henderson dodged a red card and saved a penalty. Pic: PA
Oliver Glasner’s team were the underdogs despite Manchester City having had a difficult season in the Premier League.
Pep Guardiola’s side also lost to their neighbours and rivals Manchester United in last year’s cup final.
‘It’s all about spirit’
Palace goalscorer Eze said he had “no words” as he celebrated with his team mates.
Eze celebrates after the final whistle. Pic: PA
“I can only thank God,” he told ITV. “This is special, this is what dreams are made of, for this club as well. Who would have thought we could do it?
“We’ve made history today. The tactics were good but it’s all about spirit. That’s energy, that’s everyone fighting together and doing what we had to do today.”
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