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Rayner urged Reeves to consider wealth tax rises before spring statement

1 day ago
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Angela Rayner urged Rachel Reeves to consider a series of wealth tax rises, it has been revealed, in a move that underscores growing unease within the government over the chancellor’s tight spending plans.A memo sent by the deputy prime minister to the chancellor before March’s spring statement proposed eight tax measures worth an estimated £3bn to £4bn a year, including reinstating the pensions lifetime allowance and increasing the corporation tax rate for banks.The proposals were not adopted, with Reeves opting instead to announce cuts to public spending in March, in line with her self-imposed fiscal rules.While the memo, obtained by the Daily Telegraph, was framed as a discussion document, it is likely to be seen as Rayner staking out ground for Labour’s left wing within a cabinet increasingly shaped by Starmer-aligned centrists.The document, called “alternative proposals for raising revenue”, argued the measures would not breach Labour’s 2024 manifesto pledge not to raise taxes “on working people”.

Suggestions included ending inheritance tax relief on shares listed on the smaller Aim stock market, scrapping the £500 dividend tax-free allowance, and freezing the threshold at which the 45p additional income tax rate applies.Rayner also proposed raising dividend tax rates for higher earners and targeting property traders who use corporate structures to avoid stamp duty.Jeremy Hunt, the former Conservative chancellor, abolished the pensions lifetime allowance when he was in office.Labour promised to reinstate it when in opposition but dropped the pledge before the general election.The memo suggested that the change could raise £800m.

The memo was sent two weeks before Reeves gave her fiscal statement on 26 March, and came as pressure mounted inside cabinet over expected cuts in this summer’s spending review,Rayner is understood to have raised concerns directly during a March cabinet meeting, where several ministers reportedly questioned whether revenue-raising options had been sufficiently explored,Government insiders said it was not unusual for policy papers to be circulated informally across departments, and the proposals were not indicative of an official endorsement,The tension reflects broader discomfort among some Labour MPs over the direction of economic policy, with criticism in particular over the chancellor’s decision to scale back the overseas aid budget and introduce tighter eligibility tests for personal independence payments,Sign up to First EditionOur morning email breaks down the key stories of the day, telling you what’s happening and why it mattersafter newsletter promotionAlthough Reeves has so far resisted calls for new tax increases, she is expected to revisit revenue options in the runup to the autumn budget, as forecasts for the public finances worsen.

Asked about the memo on BBC Breakfast, the environment secretary, Steve Reed, said the cabinet was “united behind the government’s plan for change”,Reed said Labour had already increased taxes on wealthy people, and highlighted changes made to the non-dom tax status, which he said would result in the richest paying more,The Conservatives seized on the memo as evidence of Labour’s instincts on taxation,“The chancellor has repeatedly refused to rule out another tax raid in the autumn, and now we know why – Labour’s top brass, including the deputy prime minister, want to come back for more,” said Mel Stride, the shadow chancellor,A government spokesperson said: “We don’t comment on leaks.

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politicsSee all
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The anger inside the Foreign Office over Israel’s blockade of aid into Gaza had been slowly building until – like an exploding pressure cooker – the foreign secretary, David Lammy, let loose his most damning criticism of Israeli since the Gaza conflict started in 2023.Lammy’s innate ability to put the rhetorical burners on issues has had to be restrained as the UK’s leading diplomat, but once he entered the Commons chamber to condemn Israel’s blockade of aid, this was Lammy unleashed.One UK diplomat formerly based in the Middle East said: “The language was carefully chosen and it was quite simply unprecedented. It marks a turning point.” Even if Lammy’s rhetoric and his actions did not match, sometimes language matters in diplomacy

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UK politics: No 10 won’t say if fuel payments U-turn will be implemented in time for this winter – as it happened

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Labour does a major U-turn but does Clueless Kemi even notice? | John Crace

Never change, Kemi, never change. We love you just the way you are. Look on the bright side: it could have been worse. KemiKaze could have used all six of her questions at prime minister’s questions to have re-examined the Tories’ very own rubbish Brexit deal. Just as she had for the previous two days

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Reform councils pledge to scrap LTNs – despite there being none in their areas

Reform UK’s pledge to remove all low-traffic neighbourhoods from the council areas it controls looks to be achieved in record time after the 10 local authorities said they do not actually have any in place.Zia Yusuf, Reform UK’s chair, said last week there would be a “large-scale reversal” of existing LTNs in the 10 areas across England where the party won control of the councils in local elections on 1 May.“We view these schemes with the same suspicion as mass immigration and net zero,” Yusuf told the Telegraph, adding: “You can expect, if you live in a Reform council, for there to be a much higher bar for any proposals for LTNs and for the large-scale reversal of these existing LTNs.”The Guardian contacted the councils now run by Reform – Derbyshire, Doncaster, Durham, Kent, Lancashire, Lincolnshire, North Northamptonshire, Nottinghamshire, Staffordshire and West Northamptonshire – and they all said they had no such schemes.LTNs are traffic interventions that filter smaller, residential roads using either physical barriers like bollards and planters or numberplate-recognition cameras to prevent motor vehicles using them as through routes

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Rupert Lowe recorded making antisemitic remark at parliament

Rupert Lowe, the MP for Great Yarmouth, made an antisemitic comment during a meeting in parliament earlier this year, the Guardian can reveal.Lowe, who was suspended from Reform UK earlier this year after a fallout with Nigel Farage, made the remark at a meeting where staff were present.In a leaked recording, Lowe can be heard remarking on the size of the camera being prepared to take footage of him. “In days gone by you’d call it a Jewish camera, but that would be politically incorrect. Because it’s so small,” Lowe said

1 day ago
A picture

Rayner urged Reeves to consider wealth tax rises before spring statement

Angela Rayner urged Rachel Reeves to consider a series of wealth tax rises, it has been revealed, in a move that underscores growing unease within the government over the chancellor’s tight spending plans.A memo sent by the deputy prime minister to the chancellor before March’s spring statement proposed eight tax measures worth an estimated £3bn to £4bn a year, including reinstating the pensions lifetime allowance and increasing the corporation tax rate for banks.The proposals were not adopted, with Reeves opting instead to announce cuts to public spending in March, in line with her self-imposed fiscal rules.While the memo, obtained by the Daily Telegraph, was framed as a discussion document, it is likely to be seen as Rayner staking out ground for Labour’s left wing within a cabinet increasingly shaped by Starmer-aligned centrists.The document, called “alternative proposals for raising revenue”, argued the measures would not breach Labour’s 2024 manifesto pledge not to raise taxes “on working people”

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‘It’s all people wanted to talk about’: How Labour U-turned on winter fuel payment cut

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More community sentences in England and Wales could be ‘catastrophic’, warns watchdog

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