I was stunned to read that Rachel Reeves is even considering extending the freeze on personal tax allowances (Rachel Reeves expected to extend ‘stealth’ freeze on income tax thresholds, 18 October). These have already been frozen for the best part of a decade thanks to a Tory government, and high inflation in recent years has exacerbated the punishing effects of this, particularly on those with lower incomes.
Only last year, Reeves, as shadow chancellor, attacked the Tories for “picking the pockets of working people” by freezing tax thresholds. It is a real kick in the teeth that a Labour government would even consider extending a measure that increases income inequality as much as this.
There are individuals and firms that can pursue aggressive tax planning and allegedly pay an amount of tax depending on their moral compass. Will Reeves be picking their pockets too?
Su Hardman
Woodbridge, Suffolk
Polly Toynbee argues that Labour could still keep true to its manifesto pledge not to increase national insurance costs for “working people” if it decides to raise the portion of that tax levied on employers (Don’t listen to the Tories – Labour is right to raise taxes, 18 October).
Yet NI payments, however they are levied, are part of the overall cost of keeping somebody on a payroll. How many businesses will be able, or prepared, to absorb this extra expense without looking to offset it against other costs of employment – pay rises, for example?
It’s inevitable that the pain of any additional employer NI costs will impact, at least indirectly, the lot of “working people”.
Patrick Donovan
London
Your editorial (16 October) is right to highlight Labour’s failure when in opposition to win the hearts and minds of the electorate on increasing taxation to end austerity, reduce child poverty and invest in public services.
Labour’s adoption of Tory rules on fiscal responsibility, including its manifesto commitment in ruling out raising income tax in the October budget will, in effect, further legitimise inequality, given the very wide differences in income and its connected contribution to enhancing personal and family wealth. This will further perpetuate inequalities in the life chances of many from birth, including its damaging impact on children’s health, education and wellbeing.
Structural reform by the government should focus on both taxing asset wealth and introducing more progressive income tax – not just the former as suggested in your editorial – to bring about a more equal society.
Prof Mike Stein
University of York
Why do analytical articles on the chancellor’s fundraising options (Budget 2024: what taxes could Rachel Reeves raise?, 17 October) always omit the obvious possibility of taxing land? Over the past 20 years, house prices have risen way beyond inflation, and this is down to the increase in the price of land – bricks and mortar do not increase in value.
Rich developers, and companies such as Tesco and utilities, have land banks for future use without paying for this exploitation. Stop rating buildings and switch instead to taxing land at its maximum permitted development value. It is a free gift for the chancellor.
Michael Meadowcroft
Leeds