When millions of families and pensioners are being squeezed cutting taxes for richest 1% can't be right priority now - Reeves

1 March 2012

Rachel ReevesRachel Reeves MP, Labour’s Shadow Chief Secretary to the Treasury, commenting on a letter in today's Daily Telegraph calling for the 50p top rate of tax rate to be abolished, said:

“When millions of families and pensioners on middle and low incomes are being squeezed by the VAT rise and cuts to tax credits, cutting taxes only for the richest one per cent cannot be the right priority now.

“But these business owners are right to call on the Government to take action to stimulate growth and jobs in our economy. That’s why Labour is calling on the Chancellor to use the almost £1 billion unspent from his failed national insurance holiday to give a tax break to all small firms taking on extra workers.

“We also need substantial and fair tax cuts to ease the squeeze on families and pensioners and jump-start our stalled economy, with a temporary VAT cut being the fairest and quickest option. Labour’s five point plan for jobs and growth also includes bringing forward infrastructure investment and a cut in VAT on home repair, maintenance and improvement work to help small companies. By getting our economy moving again our plan is a better, fairer way to get the deficit down.

“If the Chancellor really wants to know how much revenue the top rate of tax is raising he should ask the Office for Budget Responsibility, not just HMRC, to produce a report genuinely independent of government.”