SIR Keir Starmer has given the clearest sign yet that he will impose a new “Jobs Tax” on bosses at the Budget.
The Prime Minister paved the way for National Insurance hikes on October 30 – but insists he’s keeping a manifesto commitment.
His intervention comes after similar comments from the Chancellor Rachel Reeves to raise employers’ national insurance contributions.
He said: “We were very clear in the manifesto that we wouldn’t be increasing tax on working people and we expressly said that that was income tax, that was NICs etc.”
“It wasn’t just the manifesto, we said it repeatedly in the campaign and we intend to keep the promises that we made in our manifesto.
“So I’m not going to reveal to you the details of the Budget, you know that that’s not possible at this stage.
“What I will say is where we made promises in our manifesto, we will be keeping those promises.”
Critics are furious that the cast-iron pledge not to hike national insurance, VAT and income tax will be smashed on October 30.
Shadow Treasury Minister Laura Trott said: “In 2021, the Chancellor said increasing employer national insurance was a tax on ‘workers’.
“That’s why even in her own words it breaks Labour’s manifesto promise not to increase tax on working people.
“Rachel Reeves herself previously called the move anti-business and we agree, it is a tax on work that will deter investment, employment and growth, and the OBR says it will lower wages.
“Only a day after their first investment summit, the Prime Minister and Chancellor are choosing to sow further uncertainty and chaos for businesses by opening the door to a new Jobs Tax.”
When pressed about the u-turn, Ms Reeves said “it was very clear it’s about taxes on working people”.
It comes after Paul Johnson, who heads the Institute for Economic Affairs, said it would be a “straightforward breach” of the party’s manifesto.
He added: “I went back and read the manifesto and it says very clearly ‘we will not raise rates of national insurance’. It doesn’t specify employee national insurance.”
Lib Dem Daisy Cooper said: “The Chancellor needs to think again if the government is considering hiking taxes on small businesses, who have already suffered from eye-watering tax rises under the last Conservative government.
“The burden of this budget should fall on the likes of big banks, social media giants and oil and gas firms, instead of our local community businesses.
“The Chancellor should be protecting these smaller businesses, who are the backbone of our economy and the heartbeat of our communities.”
Ms Reeves revealed at the end of July that she had to fill a £22 billion black hole, claiming it has been inherited from the Tory administration.
Sir Keir also spelled out that capital gains tax could go up to 39 per cent as “wide of the mark”.
