Labour would not hit working people and businesses with a tax hike, the shadow chancellor has said, as the Tories put up national insurance contributions and living costs are soaring.
Rachel Reeves hit out at the government, who she says is “looking the other way” instead of addressing the hardships UK people are gradually facing.
In a series of tweets, she said inflation at 4.2 per cent represents a “rise to more than double the target and the highest since 2011”.
“It will leave households more than £1,000 worse off. With the growing cost of living crisis, this is extremely concerning,” she warned.
Where prices are rising and what Labour would do
Reeves said that as inflation is left out of control, linked costs for energy, car and clothing are all going up, and hospitality businesses are also dealing with increased VAT after having a hard time during the Covid pandemic.
“Fuel prices hitting another record high, and rents rising at their fastest rate in 13 years,” she said.
She added: “Instead of taking action on the cost of living crisis, the government is looking the other way, blaming ‘global problems’ while they trap us in a high tax, low growth cycle.
“Labour wouldn’t be hitting working people and businesses with a tax hike.
“As heating bills rise, we’d cut VAT on domestic energy bills now for the winter months, to help ease the burden on households.”
Tories claim they are ‘on the side of working people’ despite their actions
Despite chancellor Rishi Sunak claiming last month “this is a government on the side of working people”, as he announced a wage boost for UK residents, Tory ministers have been under intense criticism for their tax rises, benefits cuts and lack of action on rising living costs.
Shadow chief secretary to the Treasury Bridget Phillipson said at the time that the pay rise was an “underwhelming offer”.
“Much of it will be swallowed up by the Government’s tax rises, Universal Credit cuts and failure to get a grip on energy bills,” the Labour MP said.
“It’s clear that Labour is the only party serious about improving the prospects of working people.”
In September, Tory MPs overwhelmingly voted for a National Insurance hike, despite it breaking a pledge in the government’s 2019 manifesto.
The tax hike was voted through by 317 votes to 248. Unsurprisingly, all of those who voted in favour of the manifesto-busting move sit on the Conservative benches.
National Insurance is now set to increase by 1.25 percentage points from April 2022, the largest tax hike since the Second World War.
This means a worker earning £24,100 would pay £180 extra a year, while a higher rate taxpayer on £67,100 would pay £715 more.Boris Johnson appeared to suggest that the poorest people in the UK, including young people, will have to front the costs of new social care funding, but ‘everyone will benefit’.
Related: Full list of MPs who voted for the national insurance hike