Conservative MP Andrew Griffith has accused the Labour party of prioritizing tax increases over making difficult economic decisions, particularly concerning welfare spending. Griffith, speaking as Shadow Chancellor, expressed concern that Labour plans to implement significant tax hikes, including a potential increase in capital gains tax and stamp duty, to fund benefits.
Griffith highlighted a scenario of retired individuals wishing to downsize their homes to be closer to grandchildren, only to be deterred by stamp duty costs. He also raised concerns about pensioners potentially facing higher income tax thresholds and the possibility of increased taxes on savings and inheritance. This, he argued, represents a departure from a promise not to raise taxes on working people, pointing to previous tax increases on employers, family farms, and businesses, as well as VAT on school fees and a tourist tax.
The current tax burden, Griffith stated, is the highest since World War II. He cited a Sky News dossier prepared for Keir Starmer that reportedly indicates limited fiscal space for supporting living standards but includes room for reforms to capital and property taxes. Griffith interpreted Labour's use of the term 'reform' as a precursor to tax increases, citing the 'reform' of agricultural relief leading to a tax on family farms.
He also pointed to a potential increase in capital gains tax from 24% to 45%, a move reportedly warned against by senior financiers and chief executives in the City as detrimental to investment. The Shadow Chancellor also mentioned concerns about potential increases in council tax or stamp duty and taxes on savings and pensions.
Griffith contrasted Labour's approach with that of the Conservatives, who he claimed would cut taxes. He stated that a Conservative government would abolish stamp duty, taxes on family farms and businesses, reverse VAT on education, and abolish business rates for many high street shops. These cuts, he asserted, would be funded by reducing welfare spending and the cost of government.
Griffith specifically challenged Shadow Chancellor John Healey to rule out any new taxes, emphasizing a clear dividing line between the parties. He argued that Labour's strategy is to raise taxes to fund benefits, while the Conservatives aim to cut taxes, reduce the welfare bill, and allow individuals to retain more of their earnings. He suggested that controlling the welfare bill, which he described as out of control with one in five working-age adults claiming universal credit and nearly a million young people classified as 'Neets' (not in work, education, or training), is essential. Recent figures showing the Treasury borrowing billions more than expected this fiscal year, according to Griffith, prove that tax rises are inevitable unless welfare spending is curtailed.