Labour is “a long way off” deciding any possible tax rises on the rich, leading MPs said today.
Shadow Business Minister Lucy Powell declined to say whether or how the party could hike taxes on the wealthiest – including a “wealth tax” on people’s assets – to pay for coronavirus.
She told Sky News: “We’re a long way off these kinds of conversations.”
Shadow Cabinet Office minister Rachel Reeves added now “is not the right time” to raise taxes. She did not rule out a possible wealth tax in the future.
She said: “The priority right now should be on jobs and getting our economy moving. This is not the right time to be putting up taxes.”
It comes after the Tories – who themselves haven’t ruled out future tax rises – accused Labour of inconsistency over how the UK should pay for the crisis.
Tory Chancellor Rishi Sunak warned this week there will be “difficult” decisions ahead as the UK enters a “very significant recession”.
And he refused to rule out long-term tax rises after yesterday’s £30bn mini-Budget brought spending on the pandemic to almost £190bn.
With the national debt at more than 100% of GDP, the Institute for Fiscal Studies warned the government will be forced to hike taxes eventually in a “reckoning”.
But the Tories have tried to turn the focus on Labour, claiming the party should “come clean” with Brits.
Shadow Chancellor Anneliese Dodds has said those with the “broadest shoulders” should pay more, but has stopped short of outlining specific plans.
Highlighting the idea of a ‘wealth tax’, she said earlier this month: “I don’t think we’re in a fair situation – and of course for the very, very best-off people quite a bit of their money coming in is derived from wealth.”
Today Ms Powell said those conversations were “a long way off”. She added: “We don’t know what the state of the public finances are going to be.
“And indeed the government don’t know that either.
“Rishi Sunak agreed with us this week when he said that the real big indicator of any hold in the public finances in the coming months is whether we can protect jobs and employment today.
“Mass job losses will have a devastating impact, not just for those individuals but on the public finances with less taxes coming in and more money going out in terms of benefits.
“So we can really shape what’s going to be necessary for the future of any tax and spend policy today by protecting and creating jobs today – and that is our focus.”
Questioned on whether Labour would support tax hikes for the wealthy, Shadow Cabinet Office minister Rachel Reeves said the “focus” should be on jobs.
She told the BBC’s Andrew Marr Show: “We’re in a situation right now where the entire focus of government should be on protecting jobs and creating new jobs.
“The focus has got to be on jobs, jobs, jobs and getting our economy growing.
“That is the right thing to do by British businesses that are on their knees, by workers who are desperate for some hope for the future, but also that’s the best way to get our public finances back on track as well.
“Because if people are in work it means they’re spending money in their local communities, in shops and bars and restaurants and cafes, it means that they are paying taxes and contributing to the public finances.
“So that’s why we say that the priority right now should be on jobs and getting our economy moving, this is not the right time to be putting up taxes.
“This is the time to be focusing all of government’s efforts to get the economy growing and creating those jobs and that will help address the dire situation with the public finances as well.”
In an interview with the Mirror last month, Shadow Chancellor Anneliese Dodds said “those with the broadest shoulders” should make any contribution.
She later added low- and middle-earners should not face tax hikes during the pandemic, but called for a “new settlement” when it comes to the wealthiest.
Speaking in the House of Commons this week, she emphasised: “Labour is not calling for tax rises. We are calling for growth.”
But a top member of her team denied she was “backtracking” from a wealth tax overall.
Shadow Treasury minister Dan Carden said: “Labour is clear that the cost of the crisis should be borne by those with the broadest shoulders.”