Income tax: Conservatives have 'no plans' to raise tax

Michael FallonImage copyright

Senior Conservatives have said there are “no plans” to raise income tax if the party wins the general election, in an apparent change of policy.

Sir Michael Fallon said high earners had nothing to worry about, while Boris Johnson said there were “absolutely no plans to raise income tax”.

It comes after PM Theresa May scrapped a 2015 commitment not to raise VAT, National Insurance or income tax.

Labour said low earners have had “no guarantee from Theresa May” over tax.

A Conservative party spokesman said: “There is no change to our position on tax, which is made clear in the manifesto.

“We will always be the party that keeps tax as low as possible and spends the proceeds responsibly.”

The Conservative manifesto had committed the party to keeping tax “as low as possible” but had not ruled out increases in income tax.

However, Defence Secretary Sir Michael told the Daily Telegraph that income tax “absolutely” will not rise under a new Conservative government.

“You’ve seen our record. We’re not in the business of punishing people for getting on, on the contrary we want people to keep more of their earnings,” he added.

‘Not a shopping list’

Foreign Secretary Mr Johnson was then challenged on BBC’s Newsnight to repeat the promise.

He said: “We will bear down on taxation and we have absolutely no plans to raise income tax. Our plans are to cut taxes. Labour’s plans are to put them up.”

Former Conservative work and pensions secretary Iain Duncan Smith said Sir Michael had been stating the “obvious” over Tory tax plans, telling BBC Breakfast: “The Conservative party lowers tax.”

Asked why this was not in the manifesto, he said the party was trying to get away from the “idea that you set out every single thing in detail saying we won’t do this, we won’t do that, we won’t do the other because then you get a large shopping list”.

At the 2015 general election, David Cameron promised that income tax, National Insurance, and VAT – the so-called “triple lock” – would not go up under a Conservative government.

That promise lead to a U-turn earlier this year when Mrs May’s government had to ditch plans to raise National Insurance contributions for the self-employed.

The Tories have pledged not to raise VAT but to increase the personal allowance to £12,500 and raise the minimum earnings for the 40p higher rate to £50,000 by 2020.

Image caption

Boris Johnson said “our plans are to cut taxes. Labour’s plans are to put them up”

But Sir Michael appeared to go further in his Telegraph interview.

Asked whether high earners could confidently vote Conservative, safe in the knowledge their income tax wouldn’t go up, he told the paper “Yes”.

BBC political correspondent Gary O’Donoghue said Theresa May had been keen not to box herself in too much when it came to promises on taxation, but the party may now feel it has to send some signals to ensure its supporters turn out in numbers.

Shadow chancellor John McDonnell said Sir Michael’s comments showed the Tories were the party for “the few, not the many”.

“The only guarantee the Tories are prepared to give at this election is to big business and high earners while low and middle income earners have seen no guarantee from Theresa May that their taxes won’t be raised,” he said.

What are the other parties pledging?

Labour has promised to raise the income tax rate to 45p for earnings above £80,000 and to 50p for each pound earned over £123,000.

It says it will not raise income tax for those earning less than £80,000.

It says the planned rises for higher earners will help fund billions of pounds of investment for schools and the NHS and an expansion of free childcare, in what it calls a “programme of hope”.

Meanwhile the Liberal Democrats have pledged to increase income tax by a penny to help pay for the NHS, social care and mental health.

The SNP says it would support the idea of raising the top rate of income tax for those earning more than £150,000 from 45p to 50p.

It says there would be no increase in taxation on the low paid, in national insurance or in VAT.

Whereas, the Green Party wants to implement a wealth tax on the top 1% of earners and introduce a “Robin Hood” tax on financial transactions.

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