Labour has announced a “personal tax guarantee” that it would not raise income tax or national insurance for the 95 per cent of taxpayers earning less than £80,000, with tax increases for the wealthiest.
John McDonnell, shadow chancellor, hopes the policy will confer credibility on the party’s economic policies, while outflanking the Conservatives who have so far refused to recommit to a “triple lock” to hold down personal taxes.
Mr McDonnell will say the top 5 per cent of earners would pay more to fund public services, as Labour seeks to position itself as the anti-establishment party at the election.
But the Conservatives claim Labour has unfunded spending promises of £45bn, a void it claims that Jeremy Corbyn’s party will have to fill through higher taxes or much increased borrowing.
Theresa May has promised not to raise VAT after the election but has left open the possibility of higher rates of income tax or national insurance. At the 2015 election the Tories promised a “tax lock” to prevent income tax, NI or VAT rises.
Chancellor Philip Hammond has spoken of his desire for “greater flexibility” in future; the Conservatives’ large opinion poll lead suggests the party is under little pressure to offer popular but restrictive promises not to raises taxes.
Elsewhere, the Conservatives promised to help people with mental health problems, with a commitment to provide an extra 10,000 nurses to tackle the issue and to tackle discrimination.
Meanwhile the Liberal Democrats said they would protect the “triple lock” on state pensions but scrap winter fuel payments for wealthier older people if they won power.