The Budget is not due for a fortnight, yet with every day that passes its contents seem to become clearer. This morning Keir Starmer gave an interview to the BBC where he twice refused to rule out a rise in employer’s national insurance contributions in the Budget. Instead, he repeatedly stressed that Labour’s manifesto promise was specifically that it would not raise taxes on working people. Asked for clarity on whether employers could face a national insurance hike later this month, Starmer would only say that his government would ‘keep promises we made in the manifesto’ and not ‘raise tax on working people’. He also warned that the budget would be ‘tough’.
The comments come after Rachel Reeves on Monday gave the clearest hint to date that businesses could face an increase in national insurance. The Chancellor argued that Labour’s election pledge not to increase NI only applied to employees. The Business Secretary Jonathan Reynolds made a similar comment on Sunday when he told Sky News’s Trevor Phillips that Labour’s promise not to increase the tax ‘was specifically in the manifesto, a reference to employees’.
The risk is Labour fall into the same territory that Philip Hammond found himself in 2017
It comes as the Tories have gone on the attack – arguing any rise in NI whether to the employee or the employer constitutes a manifesto breach.
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