Shadow Chancellor Mel Stride renewed his call yesterday for Rachel Reeves to “step aside” after a Budget involving £26billion of tax rises.
“She should step down because at the end of the day, promises were made in the manifesto and subsequently not to increase taxes on working people. That’s exactly what has happened in the Budget,” Mr Stride said.
Asked if the Tories were worried who could replace Ms Reeves in the event she resigned, the Shadow Chancellor responded: “I’m already worried that we’ve got economic policy being basically dictated by the internal politics of the Labour Party.
“The Left of the Labour Party have pushed for an assault through the tax system on wealth, on job creation and wealth creation on the one hand, but equally this increase in spending on benefits.”
On whether the Budget contained any positives, Mr Stride retorted: “Am I allowed a negative figure? Because it would be down through the floor and beyond!
“This Budget was about all the wrong choices. It was about putting tax on hardworking people.”
Mr Stride was adamant Rachel Reeves was not forced into the tax raid by her inheritance from his party: “That’s complete nonsense! She is in hock to her backbenchers, which means she cannot control spending.
“That was the other option, particularly welfare spending. The fact that she has ducked that is the reason why people are now facing higher taxes.
Mel Stride called on the Chancellor to resign
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“The income tax increase was pretty shocking. That is going to see about 1.5 to 2 million people being either dragged into paying the basic rate of tax for the first time, or dragged into paying the higher rate of tax, whereas they were previously in a lower tax band.
“And it will see one in four workers in our country paying the higher rate of income tax. And that is just not right.”
Asked about concerns the removal of the two-child benefit cap could disproportionately benefit those of migrant background who tend to have larger families, Mr Stride said: “This isn’t about who is going to be the beneficiaries or the recipients of these particular benefits.
“It’s about a principle of fairness that applies to everybody. And that is, if you are a taxpayer, then you have to take tough decisions as to the size of your family.
Mel Stride warned taxpayers ‘will have to take tough decisions as to the size of their family’
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“And if you are a benefits recipient, it seems to be only fair that you should equally have to take those decisions and not expect the State to fund a family of whatever size you may choose.”
Committing the Tories to maintaining the triple lock, the Shadow Chancellor acknowledged the Budget introduced “elements of complication” in tax rates between old and young.
This includes a reduction in the Isa tax free allowance to £12,000 for those under 65.
“For younger people, there are two things that are really damaging.
“One is the reduction in the threshold at which the National Insurance tax kicks in. That is disproportionately affecting lower earners and, therefore, younger people.
“And the second thing is the Employment Rights Bill, which has provisions within it, which make it much more risky to take somebody on who is young, who doesn’t have a track record of working for someone else […] I’m afraid what we’ve seen from this Government is going to do a lot of damage to the prospects of younger people in a country where the Chancellor is starting to treat young and old slightly differently in the tax system.”
Mel Stride warned young people will be hit by a double blow
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In the lead-up to this year’s Budget, international businessmen have attacked Rachel Reeves’s policies, with Jonathan Oppenheimer calling the UK “uninvestible”.
Caleb Hammer, a US-based personal finance influencer, recently said: “For a successful country, you should look at what the UK does and do the opposite”.
On hearing these comments, the Shadow Chancellor reacted: “I think it’s very sad and it makes me very sad that that’s the case.
“I mean, look, we’ve got far too many people, including young people, leaving our country because they think the opportunities elsewhere are so much stronger.
“We’ve got to create a society and an economy that is an open door to new investment, creates a very attractive investment environment, lower taxes, lower regulations and then playing on all the advantages that we’ve got to offer as a country.”