Labour leader Jeremy Corbyn was forced to admit his party’s spending plans would lead to tax increases for some lower earners during an interview with the BBC last night.
In a bruising encounter with veteran interviewer Andrew Neil, Corbyn rowed back on his initial claim that only those earning over £80,000 would see a tax increase under a Labour government.
Labour plans to scrap a tax allowance for married couples worth £250-a-year, saving £535m per year.
“These people, there’s almost 2m of them, are going to lose £250 and they earn a lot less than 80,000,” Neil said.
“But they will also be getting a pay rise when we bring in a living wage. They will also be getting improvement in free nursery provision for two to four-year-olds,” Corbyn said.
Neil also cited higher dividend taxes, arguing that someone on a state pension, an annuity over £4,000 and dividend income of £2,000, would stand to pay nearly £400 more per year in tax under Labour’s plans.
“I would question that figure actually,” Corbyn said. “But what I would also say is that the whole purpose behind our manifesto, which I have here, is to recognise that we have to do something about the underfunding of our public services and the poverty and inequality that austerity has brought to this country.”
Corbyn also appeared unaware that the top rate of income tax is 45 per cent, saying that top earners pay “a top rate of about 45-50 per cent”.
Corbyn was also unaware of what percentage of income tax revenue top rate taxpayers contribute.
“I couldn’t give you the exact figure, but they contribute quite a lot,” Corbyn said.
“We think they could and should pay…a little bit more,” he added.