Keir Starmer has not definitively ruled out the possibility of increasing income tax in the upcoming Budget, as questioned during the recent PMQs session. While the Prime Minister assured that there would be no return to austerity measures, he refrained from reiterating Labour’s previous commitment made in last year’s General Election manifesto to refrain from raising taxes on working individuals, including income tax, VAT, and national insurance.
During PMQs, Tory leader Kemi Badenoch pressed Starmer on whether he still upheld the manifesto pledge. Starmer evaded a direct response and indicated that the government’s intentions would be revealed during Chancellor Rachel Reeves’s Budget announcement on November 26.
Badenoch highlighted Labour’s previous promise not to increase income tax, national insurance, or VAT and sought confirmation from the Prime Minister. In response, Starmer shifted the focus to economic indicators, mentioning positive trends such as higher-than-expected retail sales, lower inflation, upgraded growth forecasts, and a record-high UK stock market.
Starmer emphasized that the Budget on November 26 would outline the government’s plans to strengthen the economy, reduce NHS waiting lists, and secure a better future for the country. He stressed that no government reveals its detailed budgetary proposals before the Budget announcement.
Following PMQs, the Prime Minister’s press secretary declined to reiterate the party’s stance on protecting working people from certain tax increases, emphasizing that the Budget details were pending the final forecasts from the Office for Budget Responsibility (OBR) and refraining from preempting the Budget decisions.
There have been reports suggesting that Chancellor Reeves is considering raising income tax to address a significant budget deficit, with options like adding 1p to the basic rate of income tax under consideration to generate additional revenue. The Guardian proposed another potential measure for the Budget, considering a hike in the higher income tax rates for individuals earning above certain thresholds. The Treasury has refrained from commenting on speculative tax changes.
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