Keir Starmer faces demands to rule out a devastating tax increase after he failed to promise their would be no rise in VAT, in a BBC interview.Broadcaster Laura Kuenssberg asked Sir Keir whether he could pledge there would be no increase in the 20% rate of VAT, a move that would mean higher prices at checkouts.
Labour’s general election manifesto promised no increase in VAT, but Chancellor Rachel Reeves is now looking for ways to raise more money to plug a funding shortfall of between £20 billion and £50 billion. The figure will be confirmed in the run-up to her Budget on November 26. And when he was asked during Labour’s conference whether he could rule out a VAT rise, the Prime Minister simply told the BBC show that “the manifesto stands”.
The Prime Minister repeated the phrase and added: “We put that manifesto before the electorate. We got elected and that manifesto stands. I’m not going to go through the details of what may be in the Budget.
“Obviously, it’s two months away and no prime minister and no chancellor would ever sit here and indicate two months out what may or may not be in the Budget.”
Conservatives said this was not the same as a promise not to increase VAT. Conservative leader Kemi Badenoch said: “Keir Starmer just failed three times to rule out a hike in VAT.
“Claiming that ‘the manifesto stands’ is not the same as saying ‘no rise in VAT’.
“The PM must rule out hiking VAT immediately, or working people will fear another Labour tax bombshell in the budget.”
Chancellor Rachel Reeves has warned she will not abandon her “fiscal rules” which mean she must balance the books by cutting spending or increasing taxes if need be – not by increasing borrowing.
She said: “If we’re going to spend more on that thing, then that means less to spend somewhere else, or it means higher taxes. So, there’s no getting away from that.”
She added: “In those tough times, it’s even more important we have somebody who’s got a grip, has a plan and is not willing to be dragged off course by every siren call.”
