Labour’s higher tax plan could send Britain deeper into debt

LABOUR proposals to hammer middle class families and the rich with higher taxes could plunge the country deeper into debt, experts warned last night.

The Institute for Fiscal Studies said Britain was ever more reliant on a small number of taxpayers for the cash required to fund schools, hospitals and other vital services.

It pointed out that the top 1 per cent of income taxpayers already pays 28 per cent of income tax worth some £50billion a year.

And the think-tank warned that if these wealthy individuals moved elsewhere the consequences for the nation’s finances would be ‘severe’.

A Corbyn-led government would slash the threshold for the 45p rate of income tax from £150,000 to £80,000 and slap a new top rate of 50p on those earning above £123,000.

It is feared raising taxes even further on the highly paid would jeopardise this crucial income stream by persuading some to move abroad or do less work.

Any gaps in the budget would likely be plugged by more borrowing – driving up the national debt. An IFS spokesman said: ‘We have become very dependent on a very small number of taxpayers. If high-paid jobs relocate elsewhere the consequences for the Exchequer will be severe.’