Angela Rayner pushes for tax hikes on savers, in split with Reeves
Angela Rayner reportedly pushed for a £4bn tax raid on wealthier Brits in the lead up to the Spring Statement, in signs of a senior Cabinet level split on economic policy.
According to a leaked note reportedly seen by The Telegraph, the Deputy Prime Minister lobbied the Chancellor to introduce billions of pounds of taxes aimed squarely at savers.
The suggested measures included an end to inheritance tax relief for AIM shares, higher taxes on dividends, and the reinstatement of the pensions lifetime allowance – which Rayner proposed could offset the government’s scrapping of £5bn of welfare cuts.
These tax rises would raise between £3bn and £4bn, according to the document.
Rayner becomes the most senior figure in the Labour Party who appears to be uncomfortable with the government’s cuts to public spending.
The Chancellor is facing pressure from within Labour to water down various cost savings – though a recent analysis from Oxford Economics’ Andrew Goodwin suggests Reeves may have to make more radical cuts to stick within her fiscal rules.
Work and pensions secretary Liz Kendall will give a speech at the Institute for Public Policy Research (IPPR) this morning to defend her welfare plans – which she has described already this week as a “moral mission” for the government.
Starmer faces down with Conservative leader Kemi Badenoch at Prime Minister’s Questions today, where rifts within his own party could take centre stage.
Corbyn’s Labour?
Shadow Chancellor Mel Stride hit out at the leaks as an indication that “we are still living with the Labour Party of Jeremy Corbyn”.
“At the very highest level, Labour ministers are debating which taxes to increase next,” he added.
“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.”
Rayner came from the left of the party, rising quickly to the shadow cabinet as a supporter of Jeremy Corbyn following an exodus of moderate Labour figures from the frontbench in 2016.
Since her deputy leadership run in 2020, there were initial tussles with Starmer in opposition – particularly, her removal as Labour Party chair in 2021 – but these leaks represent the starkest rift yet since Labour came to power in July.