Tax rises have made an election comeback 16 May 2017 Tax rises have made a comeback in the 2017 General Election, marking a big change from recent elections where tax cuts have been front and centre of parties’ manifestos, according to a new briefing note published today (Tuesday) by the Resolution Foundation. The report notes that both Labour and the Lib Dems have committed to significant income tax rises, alongside plans for higher corporation tax. The Lib Dems are campaigning on the first rise in the basic and higher rates of income tax since the 1970s. Meanwhile the Conservatives have set out plans that would see tax as a share of GDP rising to the highest level since the 1980s, look set to scrap the tax lock from the 2015 manifesto which prevented any increases in income tax, National Insurance or VAT, and support higher National Insurance rates for the self-employed. The openness about increased taxation is in contrast to the 2010 and 2015 elections, in which promises of lower taxation, including via a higher personal allowance, were centre stage. In both cases the elections were followed by significant tax rises, including the VAT rise in 2010 and a net tax increase of £6.5bn in the 2015 Summer Budget. The Foundation says that the renewed openness on tax is welcome given the big economic and demographic challenges facing the country in the coming years and decades. Adam Corlett, Economic Analyst at the Resolution Foundation, said: “The last election campaign was characterised by expensive pledges to cut tax. “This time, there has been refreshing honesty about the need for tax rises on the right side of polling day, rather than the usual post-election tax rises. However, big questions remain about the Conservatives’ future approach to tax. “We at least have a big choice in terms of tax policies. The Conservatives have made a significant shift, no longer promising big tax cuts and ruling out tax rises, but Labour has set out the biggest set of tax rises in living memory spanning income tax, corporation tax, stamp duty on financial transactions and more.”
