On £70k? You’re rich and we’ll tax you more – Labour
LABOUR is planning an assault on the middle classes that would force 1.6 million workers to pay more tax, John McDonnell said yesterday.
Unveiling the first Labour bombshell of the election campaign, the Shadow Chancellor said he wanted a ‘fair taxation system’ which would see corporations and the rich ‘pay their way’.
Asked to define who counts as rich, Mr McDonnell told the BBC he was talking about people earning ‘above £70,000 to £80,000 a year’. Figures last night showed that would hit an estimated 1.6 million people.
The new plan for a huge tax hike on the middle classes – potentially adding thousands of pounds a year to annual bills – comes on top of Labour pledges to scrap cuts in inheritance tax, capital gains tax and corporation tax. The party has also promised to bring in a cap on the pay of senior executives, banning them from earning more than a certain multiple of the average salary in their company.
The confirmation that Jeremy Corbyn plans a return to Labour’s tax-and-spend policies of the 1980s comes as the hard-Left leader prepares to make his first campaign speech.
He will tell supporters he will stand up to ‘wealthy individuals and corporations’ if he wins the election on June 8. The Labour leader will accuse the Conservatives of creating a ‘rigged system set up by the wealth extractors for the wealth extractors’. And he will insist that, despite Labour’s appalling polling, the election result is not a ‘foregone conclusion’.
Mr McDonnell said Labour would unveil its tax proposals in its manifesto, adding: ‘What we’ve said is we want a fair system of taxation to pay for our public services.
‘I think there’s a general view in society at the moment that middle and low earners are being hit very hard with a combination of both income tax rises, but also in terms of the burden placed upon them by stealth taxes and also, as we saw, attempts by this government to increase National Insurance payments on the self-employed. We want to get a system that is fair, so the corporations and the rich pay their way more.’
Mr McDonnell said: ‘The rich will be above £70,000 to £80,000 a year and that’s roughly defined as what people feel is an earning whereby people feel they can pay more.’ Accountancy firm UHY Hacker Young calculated that 5.2 per cent of the working population would be affected – more than 1.6 million people, including 365,000 women.
Mark Giddens, a partner at the firm, said: ‘These proposals will hit many taxpayers who already see themselves as the “squeezed middle”, who already feel the pinch from taxes and the cost of housing.’
Chancellor Philip Hammond said: ‘Jeremy Corbyn’s right-hand man has shown us the serious choice at this election, between strong and stable leadership from Theresa May and the Conservatives or a coalition of chaos led by Jeremy Corbyn. The weak and unstable leadership of Jeremy Corbyn, propped up by the Lib Dems and the Scottish Nationalists, would wreck the economy and weaken our hand in the Brexit negotiations.’
In his speech today, Mr Corbyn will say: ‘Much of the media and establishment are saying this election is a foregone conclusion. But of course those people don’t want us to win. Because when we win, it’s the people, not the powerful, who win. The nurse, the teacher, the small trader, the carer, the builder, the office worker win. We all win.
‘They say I don’t play by the rules – their rules. We can’t win, they say, because we don’t play their game. They’re quite right – I don’t. And a Labour government elected on June 8 won’t play by their rules.’
‘Weak and unstable leadership’