EXCLUSIVE: Andy Burnham won’t commit to keeping Labour’s manifesto promises on tax and has opened the door to new tax rises if he becomes PM.
His decision to back the current fiscal rules wins him a reprieve from markets, but it limits his options to fund policies like council house-building. It raises the prospect of tax hikes.
Asked by Bloomberg if he is committed to Labour’s election manifesto pledges not to raise income tax, national insurance, VAT or corporation tax, his campaign declined to say so.
They also didn’t rule out new taxes on wealth.
Burnham’s spokesperson says he doesn’t want talk about tax policy during this by-election:
“Andy is fully focused on working hard for every vote in Makerfield so he can represent them in Parliament. Andy is not standing on a national manifesto at this election; he is standing to make a difference for the people of Makerfield and to bring the change he has delivered in Greater Manchester to the national stage.”
Burnham has recently called for the top rate of tax to be hiked to 50p and a council tax reevaluation to target the wealthy. “We have overtaxed labour and undertaxed wealth,” he said last year.
But former Jeremy Hunt SpAd Adam Smith says wealth taxes don’t raise sufficient revenue and it is inevitable Burnham will have to look at the big taxes if he is going to implement bolder policies.
Bond yields are rising again due to fears a new Prime Minister would loosen the fiscal rules. Some are saying this makes Keir Starmer’s case to stay for him. But there’s one potential challenger who might be seen even more favourably by the markets https://t.co/zBwSCrpmZ3
Burnham lives in fantasy land. Bond markets are just maths — you can’t fool them by changing names around.
Borrowing more means asking someone to buy your extra debt. That comes at a price.
Result: interest costs (already more than we spend on defence) go up even more.
The Mandelson affair was survivable. Keir Starmer’s explanation for it may not be. It is a parable of his premiership and its wider problems- that the explanation is always process, not politics.
Piece from me on the limits of process politics
https://t.co/XYX9j5uxgH…
I wrote about this in the @telegraph a few weeks ago. A brief look at the publicly available OBR timetable and process at the time showed they were lying. https://t.co/skWL4h6duZ
This was in the foreword of the OBR's report. Agree with @peston it's weird that despite sending Rachel Reeves its *final* forecasts on 31 October (with all details about tax take more than wiping out productivity deficit) she still went ahead with Downing Street speech laying groundwork for income tax rate rise four days later.
And then a week after *that* she doubled down on rate rise in interview with @bbc, responding to a question on it by saying: "It would, of course be possible to stick with the manifesto commitments, but that would require things like deep cuts in capital spending".
Yet days later - after a very bumpy week for Keir Starmer's leadership - it emerged she had opted not to go ahead with plan, with Treasury sources briefing that tax take from higher than expected wage growth meant she didn't need to proceed.
Hard to escape feeling that this was a political choice amid anxiety over fall-out from manifesto breach. If not then why stick with the narrative for so long with all the market implications that entails?🤷
🖊️ 'Further tax rises to pay for the scrapping of VAT could do even more damage to the economy' | Writes @Adamtih
Read the whole story below ⤵️
https://t.co/GYVLyoxJFS
Tax rises are coming. But which ones and what does that mean for the Chancellor? I set out the options and implications in the @Telegraph https://t.co/zZYMLAU5WK
How useful are events like the IMF spring meeting from a political point of view? Not very in my view. Focus is better placed on the big picture issues of tax, spend and borrowing https://t.co/auLikGK9TH
I’m in @Telegraph today on why increasing taxes to subsidise certain favoured sectors is the wrong approach to ‘shelter’ British businesses from the Trump tariff storm https://t.co/3kUtOWLzwl
My latest @Telegraph article is on how the political difficulties re welfare and spending facing the Chancellor now could be a walk in the park to what she will face in the autumn https://t.co/l2BUaKnpfe
How to fund an uplift in defence spending? In @Telegraph I showed how the Chx could halt her NICs rise. She could choose to use the spending cuts I outline to fund defence instead. Better than the suggestions to try and borrow more outside the fiscal rules https://t.co/MmyU1ejl81
The need to increase defence spending may actually make the spring forecast a bit easier for the Chancellor if she decides to raise taxes then to pay for it https://t.co/iznC8D5ZNQ