Labour promised not to impose a massive tax raid on working people in its 2024 general election manifesto
Earners, savers and homeowners will be hit hard after Chancellor Rachel Reeves announced a £26 billion tax raid in the Budget – despite Labour vowing to limit tax rises to £8.5 billion in its 2024 general election manifesto.
The Chancellor is already facing backlash after announcing tax rises amounting to £26 billion in the Budget as she battles a downgrade in forecast economic growth.
Conservative Party leader Kemi Badenoch accused Ms Reeves of incompetence after raising “tax after tax after tax” rather than cutting welfare to get millions of Brits back into work.
Among those are mansion tax, with the Chancellor announcing a high-value council tax surcharge on properties worth over £2 million.
Meanwhile, millions will pay more tax as existing freezes to personal tax thresholds are extended until 2030-31, in what many have branded a “stealth tax”.
Savers will be hard in by the Budget announcement. Picture: PA
Badenoch slammed Ms Reeves for raising ‘tax after tax after tax’. Picture: Alamy
The freeze in tax thresholds would result in 780,000 more paying the basic-rate, 920,000 more higher-rate and 4,000 more additional-rate income tax payers in 2029/30.
Salary-sacrifice pensions will also be taxed, while the Chancellor is raising taxes on dividends and savings.
It comes after Labour promised in its 2024 general election manifesto not to impose a massive tax raid on working people, instead vowing to crack down on tax dodgers and avoiders, energy firms, billionaires and wealthy foreigners living in Britain.
The party was elected vowing to raise taxes by just £8.5billion, up spending by £9.5billion and borrow £3.5billion to deliver on its manifesto pledge.
Point one of its so-called ‘first steps for change’ in its 2024 document was to deliver economic stability “with tough spending rules, so we can grow our economy and keep taxes, inflation and mortgages as low as possible.”
But now, Ms Reeves has been accused of tearing those manifesto commitments up.
Greg Smith, a Tory shadow business minister, said: “This Budget has increased taxes across the board, smashing up Labour’s manifesto commitments.
“Worst hit are landlords and savers, especially those doing the right thing to save for a pension.“Labour are doubling down on the failures of last year’s Budget, which will leave people poorer, especially working people.”
Reform UK Leader Nigel Farage has hit out at the Chancellor’s budget. Picture: Getty
Reform UK leader Nigel Farage branded the Budget an “assault on aspiration and an assault on saving”.
He said: “Working people are going to be subsidising a welfare bill that shows no sign of going down whatsoever.
“The Rachel Reeves version of abolishing the two-child cap will cost over £3billion. Our plan to get rid of it for working British couples would have cost a mere £300m every year.
“And if you look at the projections they quite clearly admit that net migration by the end of this Parliament will go up to over a third of a million every year, and on net zero there is absolutely no acceptance from this Government whatsoever of the vast damage that net zero is doing.”
Financial secretary to the Treasury Lord Livermore has denied that Labour has broken its manifesto pledge.
He told LBC’s Shelagh Fogarty: “We did decide not to cut spending, but that did mean we had to ask everyone to make a contribution. But we were able to make. Minimise the contribution.
“We were able to ask working people for. And the Chancellor was very, very clear in her statement today that that would have consequences for working people. She was very clear about that. But we were able to minimise that contribution by introducing a set of fair reforms elsewhere.
“For example, increasing property levies for expensive properties over £2 million, rising to £5 and £10 million. So I think that’s one way in which we could minimise that contribution that we were asking for”.
It comes as Labour continues to plummet in the polls.
Nearly half of Britons 49 percent believe Ms Reeves has been doing a bad job as Chancellor, with her ratings consistently low during this year, recent polling by IPSOS shows.
Meanwhile, just 17 percent believe that she is doing a good job, according to the pollster’s survey.
Half of Brits also feel worse off than when Labour was first elected, with the party commanding less than 20 percent support in opinion polls.
By Jacob Paul
