Labour Party promises to scrap business taxes

Rachel Reeves discusses Labour's plans for tax reliefs

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In her keynote conference speech yesterday, the Shadow Chancellor vowed to spend £28billion a year on green projects if the party wins the next general election. Ms Reeves also promised to scrap business taxes without saying how the Treasury would make up the £25billion shortfall. And she signalled her desire to throw open the doors of Downing Street to union bosses in a lurch back to 1970s-style economic management.

“Labour will lead a new era of industrial strategy working hand-in-hand with trade unions and with businesses,” she said.

Tory sources said her latest pledges take the total spending commitments without price tags adopted since Sir Keir Starmer took over as Labour leader nearly 18 months ago to an eye-watering £170billion a year.

A Tory source said: “This is the same old Labour writing cheques they just can’t cash.

“In less than a year Labour have committed to spend more than £170billion of taxpayers’ money without explaining how they will pay for it. This is more fiscal incontinence than fiscal prudence. Only Conservatives can be trusted to manage the economy and public finances responsibly, taking difficult but fair decisions in order to keep investing in public services.”

Ms Reeves used her first conference speech as Shadow Chancellor to insist she would take a “responsible” approach.

But she also claimed the Government was not doing enough to ensure a “transition” to a green economy.

Around £28billion a year should be spent on electric car factories, wind turbines, hydrogen energy and other environment projects, she said.

She added: “We will meet the challenge head on and seize opportunities of the green transition.”

Ms Reeves insisted Labour had “no plans” to raise income tax even though the cost of her environmental package would be the equivalent of an extra 4p on the basic rate of the levy.

And she promised to drop dozens of business tax breaks.

“If it doesn’t deliver for the taxpayer or for the economy then we will scrap it,” she said.

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