Labour to Reverse Pre-Election Position With Stealth Income Tax Hike
Amid the flurry of pre-budget briefing the FT now reports that Reeves will extend Sunak’s 2021 income tax threshold freeze beyond 2028, when it was due to end. The current threshold freeze will raise more than £33.5bn by 2029 and will drag 3.8 million more taxpayers into the additional rate band….
The stealth tax was a big focus for Labour’s attack operation before the election. Reeves said last year “Labour aims to lift a freeze on tax thresholds that is on track to cost workers on the basic 20% rate of income tax £750 a year each.” The party’s assault on the “25 Tory Tax Rises” singled out thresholds in particular: “Labour has found that Tory stealth tax rises over the next two years have hit the average sales assistant with a £660 tax bombshell.” Not only will Reeves not reverse the tresholds – she is specifically set to make the “bombshell” worse for longer…
Labour claims that the manifesto pledges won’t be broken with this because Labour only pledged to keep rates at the same level. The public are sure to be sympathetic…
