Labour’s secret tax increases will be merciless

Wes Streeting’s admission yesterday – that Labor has spending plans that go beyond what it promised in its manifesto – should blow open the doors and prompt a proper investigation into exactly what a Sir Keir Starmer government would do.

On television, the shadow health minister admitted that the Labor manifesto is not the party’s real plan for government. This should come as no surprise: Starmer has had a habit during his own leadership campaign of making promises only to reject them as soon as he wins. The manifesto is a document that only the gullible can believe.

Labor is promising a revolution in the NHS, funded by closing a number of tax loopholes, which it says can be easily achieved. It claims it will decarbonize the grid by 2030 – a target experts say is impossible – with a fifth of the budget it originally set itself to do the job.

Even the tax rises that Labor admits would, based on official forecasts, take Britain’s total tax burden to the highest percentage of our national wealth ever recorded: even more than Clement Attlee’s previous record in 1948.

But the published plans are of course a sham. As Paul Johnson of the Institute for Fiscal Studies says: “Labour’s manifesto offers no indication that there is a plan for where the money should come from” to fund its promises. This is because, as leaks in the shadow cabinet reported The guard confirm that Starmer and his shadow chancellor Rachel Reeves are planning an emergency budget this autumn.

In that budget, the party will claim that finances are much worse than feared – even though all the necessary data has already been published and freely available – and impose a dozen new taxes. According to a source familiar with the plan, Reeves wants to take “a kitchen sink approach to increasing tax revenue.” The source admitted: “This is not what they are presenting to the public now.”

This is straight out of the Labor playbook. Starmer and Reeves brag about how they learned from the New Labor years. In 1997, Tony Blair and Gordon Brown had already agreed to abolish tax relief on dividends received by pension funds, but they kept the plan out of the manifesto and bullied the Guardian editor into stopping him from reporting on it. In 2001, they refused to inform the country of their plan to increase national insurance premiums to finance additional healthcare spending.

Now Starmer and Reeves are refusing to tell us their secret tax plans at this election. Labor has pledged not to charge income tax, national insurance contributions or VAT. But it argues – as with imposing VAT on school fees – that removing an exemption is not a tax increase. Any existing tax reductions – for example on pension contributions or company taxes – are therefore outside the scope of the promise.

Labor has been remarkably unsubtle in its approach to taxing pensions. Its refusal to support the Conservative ‘triple lock plus’ policy – ​​which promises to prevent the state pension from ending up in income tax by linking its value to pensioners’ personal tax allowances – can only mean that it intends to to tax yourself. It even suggests it will freeze income tax thresholds completely over the next five years – even as its spokespeople and shadow ministers continue to claim that “people are not going to pay more income tax”.

Then there is the issue of the application of capital gains tax to family homes. Firstly, Angela Rayner, the Labor deputy leader, refused to rule this out during the ITV debate last week. And then Sir Keir Starmer did the same during his BBC interview with Nick Robinson. On Saturday, Starmer’s campaign director Morgan McSweeney “liked” a social media post saying Labor should “raise capital gains tax” to bring £15 billion into the Treasury. No doubt Starmer will argue, as he does with school fees, that this would not be a tax increase because technically it would be the abolition of a tax credit.

Because this is Labour’s logic: the instinct of Starmer and his party. Anything that is not taxed is treated with suspicion – a privilege that should be revoked by the state. And so everything will be fair. Business taxes, pension taxes, driving taxes, property taxes, green taxes on energy bills – they are all in Labour’s sights. It even wants to enshrine taxation, spending and redistribution into law, and impose a legal duty on public authorities to reduce inequality. This was dangerous enough when it first came up in 2010, when the Equality Act was passed. In the age of critical race theory and the pursuit of “equality,” this will lead to catastrophic – one might even say systemic – unfairness.

And this is the lesson of the Labor manifesto and its wider campaign. Listen very carefully to what it says. Pay close attention to what isn’t there. And try to understand not just the proposed policy, but also the instincts and motives that drive those policies. We cannot know what will happen next year, let alone what might happen in the year 2029. Over the next five years we will face economic challenges, geopolitical threats and the dangers of terrorism. The main risks include a new pandemic, the loss of telecommunications cables and the disruption of food and energy supplies.

How a government responds to the unknown is determined by the instincts of its leaders. Starmer fought to overturn the Brexit referendum, campaigned to make Jeremy Corbyn Prime Minister, tried to block the deportation of foreign criminals, wanted Covid lockdowns to last longer and at greater cost, supported divisive critical race theory and discredited gender ideology, and response to Black Lives Matter, chose to take a knee in front of the cameras.

The polls show that we are heading for a huge Labor majority. If it comes to that, we know what to expect. It is evident not only in what Starmer says – and what he doesn’t do – but also in his instinctive response to every challenge. There is no problem to which his answer is not higher taxes, more government and legalistic interventionism. These are not the ingredients for us. We need a strong Conservative Party to stand up to him.

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