Starmer refuses to rule out further tax rises
The Prime Minister has refused rule out further tax rises when challenged by Tory leader Kemi Badenoch during Prime Minister Questions.
The fiery exchange came after it was revealed that Deputy Prime Minister Angela Rayner pushed for a £4bn tax hike on wealthier people in the lead up to the Spring Statement earlier this year.
Rayner’s proposals, which included an end to inheritance tax relief for AIM shares, higher taxes on dividends and the reinstatement of the pensions lifetime allowance have sparked fierce debate in light of expectations that further tax rises might be on the cards for the Autumn Budget.
When asked explicitly to rule out more tax rises this year, Starmer responded by attacking the Conservatives’ track record, particularly on the economy.
Badenoch then accused the PM of obfuscating and “refus[ing] to rule out new tax rises.”
“Open warfare” in Labour cabinet
Badenoch, said: “the Deputy Prime Minister is on manoeuvres, [Starmer has] lost control of the economy, he’s lost control of his cabinet.”
Badenoch then pointed to Rayner. “She knew exactly what she was doing when she briefed that into the papers. She’s demanded eight new tax rises, as if we haven’t suffered enough. People out there are struggling, businesses are struggling … we cannot have more tax rises,” Badenoch said.
Starmer dismissed the accusation of division within his Labour Cabinet: “The Deputy Prime Minister, working with the Chancellor, [is] putting 1.5m new homes, reforming our planning system, putting £7bn into our economy.”
Badenoch hit back: “His cabinet is open warfare, the Deputy Prime Minister [is] clearly calling the shots … we’re heading for new tax rises, we know inflation is up.”
Starmer responded by saying that it is Badenoch who has “lost control of all of her party. They are sliding into oblivion. They will have to trade on their past … because that’s all they’ve got.”
Inflation spikes in April
Badenoch blamed the government for the increase in inflation to 3.5 per cent, announced this morning. Starmer said that Badenoch “forgot to say” that inflation reached “eleven [per cent] on their watch.”
Starmer referred to the “disastrous Liz Truss mini budget, inflation through the roof, they left a £22 billion black hole, living standards at an all time low, energy prices … through the roof.”
Badenoch defended her own party by invoking the circumstances under which inflation rose exceptionally in 2022: “We were reacting to a war in Ukraine that brought inflation up in all of Europe.”
“Inflation was brought down by us bang on target,” Badenoch reminded MPs.
The Labour leader told MPs that the government is “taking measures, obviously, to help with the cost of living crisis,” including by signing a deal with the EU. “The EU deal will bring prices down” which is why “supermarkets welcome it,” Starmer said.