TAX RAID
Keir Starmer WON’T rule out National Insurance hikes in shock U-turn on manifesto promise
Sir Keir Starmer left the door wide open for a tax raid on employers
A £17BIILLION tax raid could clobber bosses under Labour plans for a manifesto u-turn, Sir Keir Starmer hinted today.
The PM refused to rule out hiking National Insurance on employers when grilled three times by Rishi Sunak.
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Labour's manifesto stated that “Labour will not increase taxes on working people, which is why we will not increase National Insurance, the basic, higher, or additional rates of income tax, or VAT” .
In their first exchange at Prime Minister's Questions after party conferences season, Mr Sunak said: "Can he confirm that when he promised not to raise income tax, National Insurance or VAT that commitment applies to both employer and employee national Insurance contributions?”
Sir Keir replied: “As he well knows I am not going to get drawn on decisions that will be set out [at the Budget].
"We made an absolute commitment in relation to not raising tax on working people.
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“He of course was the experts’ expert on raising taxes.”
Asked the same question again, Sir Keir would only go so far as to say that he would stick to the promises made in Labour’s manifesto.
The PM also refused to rule out changing fiscal rules to increase Budget spending power.
It comes amid speculation Rachel Reeves could do to potentially unlock up to £57bn in additional spending on infrastructure.
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Replying to Mr Sunak, Sir Keir said: “This is literally the man who was in charge - 14 years they crashed the economy. What did they leave? A £22 billion black hole.”
The Tory leader then told the Commons: “He has opened the door to raising employer National Insurance contributions including on pensions and fiddling the figures that he can borrow more."
Shadow Chancellor Jeremy Hunt also hit out on Twitter: "The Prime Minister has today left the door open to the Labour Party breaking their promises to the British people by raising taxes and increasing borrowing, leaving future generations to pick up the bill and risking higher interest rates.
"Keir Starmer and Rachel Reeves should have had the courage and conviction to be honest about the tax and borrowing plans they always planned."
What is National Insurance and what is the difference between employee and employers contributions?
NATIONAL Insurance (NI) is a tax on earnings and self-employed profits in the UK that helps pay for state benefits.
Both employees and employers must pay NI, but their contributions work differently.
Employee contributions are deducted directly from their salary based on how much they earn.
Employer contributions, on the other hand, are additional payments that businesses make based on their employees’ wages.
This means that for every employee, the company pays extra to the government.
Employees’ NI contributions affect their eligibility for benefits like the state pension, while employers’ contributions are just a cost of hiring staff.
An increase in employer NI means higher employment costs, which could impact hiring decisions and salaries.
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