Key facts
- Shadow chancellor Andrew Griffith is urging Prime Minister Andy Burnham to rule out further tax rises in the upcoming Budget.
- Griffith claims Labour has already introduced almost £70 billion in tax hikes.
- Griffith stated that Labour's tax policies are 'crushing' small businesses.
- Prime Minister Andy Burnham has refused to rule out tax rises, citing the challenging state of public finances.
- Inflation rose to 3.1% in August, the highest in five months.
- Government borrowing costs have reached a 28-year high.
Shadow chancellor Andrew Griffith has called on Prime Minister Andy Burnham to rule out further tax increases in the upcoming Budget, warning that current taxes are 'crushing' the economy. Griffith stated that Labour has already introduced significant tax hikes, disproportionately affecting small businesses.
Griffith claimed that Labour has introduced almost £70 billion in tax hikes in its first two Budgets, adding that the party's 'jobs tax' and business rates raid have caused 'immense damage'. He urged Burnham and Chancellor John Healey to pledge not to introduce an Exit Tax or any other new taxes.
However, Prime Minister Andy Burnham has refused to rule out tax rises, citing the 'challenging' state of public finances and the need for a 'careful approach'. He defended previously announced cost of living pledges as funded by reprioritising existing spending, such as scrapping digital ID cards to fund a cut in VAT on energy bills.
Former Bank of England deputy governor Sir Charlie Bean and former chief economist Andy Haldane have expressed concerns about the government's fiscal sustainability, with Haldane suggesting markets suspect a 'traditional tax and spend socialist government'. Burnham has pushed back against such characterizations.
Official figures showed inflation rose to 3.1% in August, the highest in five months, and government borrowing costs have reached a 28-year high amid concerns about Burnham's spending plans. Economists expect the Bank of England to hold interest rates but forecast multiple rises in the next 12 months.