Chancellor of the Exchequer MP said:
“This is a sober analysis of the challenge we continue to face,
and a stark reminder of why we must deliver on our commitment to
deal with our country’s debts.
“The Labour party would ignore these warning signs from the OBR,
adding to the bill that our younger generation will have to pay.
Under ’s catastrophic plans, the
independent Institute for Fiscal Studies estimate the national
debt would be over £100 billion higher by the end of this
Parliament than under a Conservative government - or over £6,000
per working household.
“Now is the time to stick to our plan of tackling our debts while
investing in our future so that we can deliver economic security
and high quality jobs for hard-working people across the
country.”
ENDS
Notes to Editors
-
· The
IFS found that debt would be higher under Labour by the end of
Parliament. The Institute of Fiscal Studies
concluded that national debt would be £106 billion (4.5 per cent
of GDP) higher by 2021-22 under Labour (IFS, General
election analysis 2017, link).
-
· There
are 17,600,000 working (working and mixed) households in the
UK (ONS, Working and workless households
in the UK: Jan to Mar 2017, 31 May 2017, link).
-
· The
IFS have said that Labour’s manifesto would involve ‘one of the
biggest tax increases in the last 30 years or
so’. Paul Johnson, Director of the IFS, said:
‘Well, it would make it one of the biggest tax increase
in the last 30 years or so. I mean
you could introduce an increase of that level
- it would return the main rate of corporation tax to where it
was 6 or 7 years ago, but of course two important things about
corporation tax first – it’s not a victimless tax – this would
increase taxes by about 1 per cent of national income
– so it would in the long run leave us all about 1 per
cent worse off, and of course it is people in the end, it is
people in the end who pay it and it would reduce incentives for
companies to invest in the UK’ (Today Programme, 10
May 2017).
-
· Labour’s
tax hikes would hit ordinary working families with lower wages
and higher prices. ‘What Labour actually want you
to hear is that the spending increases they promise… would be
funded by tax increases solely affecting the rich and
companies. This would not happen … In the
longer term, much of the cost [of tax rises] is likely to be
passed to workers through lower wages or consumers through higher
prices’ (Carl Emmerson, IFS, 26 May 2017).
-
· Labour’s
tax plans wouldn’t raise as much as they claim, according to the
IFS.
Studio: Let’s talk first about Labour and your
assessment, having looked through the numbers in the manifesto –
the tax plans in particular?
Paul Johnson: ‘actually they can’t raise the £50bn
they say they would raise just from the increases that they
say, so you can’t raise that amount of money just by taxing
companies and a little bit off the rich’ (Interrupted)
Studio: And you’re absolutely sure about that –
that it doesn’t add up?
Paul Johnson: ‘It absolutely doesn’t add up.’
(Paul Johnson, Today programme, 7 June 2017)
