The Chancellor needs to tell us in her Budget that to fix our broken economy we all need to pay more tax, with the wealthiest paying the most, Brian Reade says. Because Labour has nothing to lose right now
There’s a golden rule of British media scaremongering that’s been heavily weaponised for 40 years. If you want to terrify the nation, evoke images of rubbish mountains, bread queues and the kipper-tied rich leaving Heathrow in their droves, claiming this is what Labour did to the country in the Satanic Seventies and announce they’re taking us back to hell in a communist handcart.
Which always makes me laugh because I have joyous memories of the 1970s. When this country reached peak equality, working-class kids like me could get a trade or a free degree and community values still meant something.
The prophets of doom are wailing again, this time about the near-certainty that Rachel Reeves will become the first chancellor since Labour’s Denis Healey in 1975 to raise the basic rate of income tax.
What they don’t tell you is that back then the basic tax rate was 33%, there were eight rising rates up to 70%, and Healey increased them all by 2%. Only the top rate of 83% (yes, 83%) was left unchanged. Today the top rate is 45%, and if Reeves raises the basic rate by 2p it will only reach 22% – 3% lower than when Thatcher left office in 1990. And it would still leave us with a lower tax burden than most comparable economies.
The stick Reeves is being beaten with is that to do so would break her party’s manifesto pledge not to raise income tax, which Labour will be punished for at the next election. But with Labour’s ratings through the floor, what is there to lose?
Plus, when we need to find £107billion every year just to cover the interest on our colossal debts, the party and the nation has a lot more to lose if Reeves doesn’t address the bleak financial realities. And what are the electoral alternatives? Nigel Farage has U-turned on Reform’s manifesto pledge before last year’s election to slash £90billion in taxes because he believes that’s not “realistic.” Ten Job Johnny now hopes to slash welfare and public services while freeing up tax cuts for the wealthy.
Who can take Tory accusations of tax betrayal seriously when Osborne’s austerity, Cameron’s Brexit, Johnson’s botched Covid and Truss’s Budget are mainly why we are so skint? Labour is sinking in popularity because voters perceive them to lack vision and competence. And their track record, particularly Reeves’s, does nothing to dispel that. It’s time to address that perception head-on.
Time to say we can’t have world-class public services and a properly funded welfare system that allows the poorest to live with dignity, as well as low taxation.
Honesty is Reeves’s only choice. She needs to tell us in her Budget that to fix our broken economy we all need to pay more tax, with the wealthiest paying the most. She should admit Labour was wrong to promise no income tax hike but in breaking that promise she puts her country before her party.
Kemi Badenoch claimed Reeves’s dire speech on Tuesday, aimed at softening us up for a tough Budget, was a “waffle bomb”. Well here’s a bit of advice, Rachel. When Healey was slaughtered by all sides for his income tax-raising budget 50 years ago he said: “It is dictated by the harsh reality of the world we live in.” In 18 days you need to blow everyone away with a reality bomb.
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