City A.M. takes you through five financial policies Keir Starmer has had a change of heart on since taking over his party.
Last week, Labour officially announced the long-anticipated news they were ditching their commitment to investing £28bn a year in Britain’s green energy transition.
Leader Sir Keir Starmer and shadow chancellor Rachel Reeves had already walked it back over time, including saying the full amount would be reached by the end of the Parliament and be subject to the party’s fiscal rules.
But with the figure now definitively dropped, Starmer has come in for more than a bit of criticism for his propensity to change his mind. However, advocates of his approach praise the politician’s apparent ruthlessness in the pursuit of power.
City A.M. takes you through five other financial policies Starmer has expressed a change of heart on since taking over his party.
1. Income tax
When he ran for Labour leader in 2020, Starmer pledged his government would raise income tax for the top five per cent of earners.
But speaking to the BBC in 2023, he confirmed he had moved away from the policy, saying: “We’re in a different situation now. I think we have the highest tax burden since World War Two.”
Starmer also told the Telegraph he wanted to lower taxes and was “not looking to the lever of taxation”.
Read more
Starmer’s prawn cocktail offensive is just that: palatable but lacking substance
2. Digital services tax
Reeves announced plans to increase the digital services tax (DST) – a levy on big tech firms like Google, Amazon and Facebook – from two to 12 per cent, at party conference in 2021.
The party suggested it could fund a freeze in business rates in 2022-23.
But by 2023, Labour confirmed it had no plans to raise the DST, and insisted the hike was only ever proposed as a “temporary measure”, according to the Times.
3. Wealth tax
In September 2021, Rachel Reeves suggested Labour could look at increasing taxes on wealth, saying “people who get their income through wealth should have to pay more”.
She highlighted examples such as stocks and shares and buy-to-let properties. But by the summer of 2023, she had changed her mind, as per an interview with the Sunday Telegraph.
The shadow Chancellor confirmed Labour would not seek to bring in a mansion tax or to increase capital gains tax, saying: “We have no plans for a wealth tax.”
Read more
A wealth tax could raise as much as £55bn – but is it really the answer?
4. Private school charitable status
Also in 2021, Reeves said Labour would strip private schools of their charitable status, which would have ended VAT tax exemptions, and diverted the money into state schools.
“Here’s the truth: private schools are not charities,” she was reported as saying at the time.
But, as first reported by the i paper in September 2023, the party has since rowed back on its promise, but still insists it would remove the VAT tax exemption and that the charitable status description was used as a shorthand for the wider policy.
5. Bankers bonus cap
Finally, in another indication of Labour’s efforts to woo the City and big business, the party has now confirmed it would not reinstate the bankers bonus cap.
Rules were brought in by the EU in the wake of the 2008 financial crisis, and scrapped by then-Chancellor Kwasi Kwarteng in 2022 and kept in place by Rishi Sunak.
Shadow Treasury minister Darren Jones previously said the “decision tells you everything you need to know about the priorities of this out of touch Conservative government”.
Reeves has now said she has “no intention” of restoring it, and added, if elected into power, “I would want to be a champion of a successful and thriving financial services industry”.
Read more
Rachel Reeves: Labour has ‘no intention’ of restoring bankers’ bonus cap
News Related
-
Asylum seekers travel in an inflatable boat across the English Channel, bound for Dover on the south coast of England (Photo: Ben Stansall/AFP) Up to 40 Conservative MPs are poised to rebel over Rishi Sunak’s Rwanda deportation policy as they question ministers’ commitment to the scheme. A major row is ...
See Details:
Up to 40 Tory MPs ‘set to rebel’ if Sunak’s Rwanda plan doesn’t override ECHR
-
In the saltmarsh fringing where the Ballyboe River dissolves into Trawbreaga Bay, a little egret wears its plumage like a windblown stole. Our car swoops across the 10 arches of Malin bridge and we park along the village green. Malin is almost as far north as you can get on ...
See Details:
Country diary: A tale of three churches
-
Photograph: Chris Ratcliffe/EPA Hampton Court is an enduring monument to the power of Henry VIII, a pleasure palace down the Thames from Westminster and the City of London. On Monday it was the scene of power projection of a different kind, as Rishi Sunak pitched for investment from some of ...
See Details:
Sunak woos business elite with royal welcome – but they seek certainty
-
-
Tottenham interested in move to sign “fearless” £20m defender in January Tottenham Hotspur have joined the race to bring an overseas defender to the Premier League in January, according to a fresh report. Postecoglou’s centre-back options The Lilywhites currently have Micky Van De Ven, Ashley Phillips, Cristian Romero and Eric ...
See Details:
Tottenham interested in move to sign “fearless” £20m defender in January
-
A £100m campaign urging households and businesses to use less water will be funded from customers’ bills, Ofwat has said. Bill payers to stump up cost of £100m water usage campaign The regulator’s chief executive David Black told MPs that if the measures worked it would be cheaper than building ...
See Details:
Bill payers to stump up cost of £100m water usage campaign
-
FILE PHOTO: Soccer Football – FIFA Women’s World Cup Australia and New Zealand 2023 – Group B – Canada Training – Olympic Park, Melbourne, Australia – July 24, 2023 Canada’s Christine Sinclair during training REUTERS/Hannah Mckay/File Photo (Reuters) – BC Place in Vancouver, British Columbia, will be renamed “Christine Sinclair ...
See Details:
Soccer-Venue renamed 'Christine Sinclair Place' for Canada soccer great's final game
-
Michael van Gerwen is hunting down a fourth World Championship title (Picture: Getty Images) Michael van Gerwen is Phil Taylor’s tip to lift the World Darts Championship trophy for a fourth time in January, expecting a backlash from the recent defeat in the Players Championship Finals. The 2024 World Championship ...
See Details:
Phil Taylor makes his pick for 2024 World Darts Championship winner
-
Michael van Gerwen is hunting down a fourth World Championship title (Picture: Getty Images) Michael van Gerwen is Phil Taylor’s tip to lift the World Darts Championship trophy for a fourth time in January, expecting a backlash from the recent defeat in the Players Championship Finals. The 2024 World Championship ...
See Details:
Soccer-Howe aims to boost Newcastle's momentum in PSG clash
-
Michael van Gerwen is hunting down a fourth World Championship title (Picture: Getty Images) Michael van Gerwen is Phil Taylor’s tip to lift the World Darts Championship trophy for a fourth time in January, expecting a backlash from the recent defeat in the Players Championship Finals. The 2024 World Championship ...
See Details:
Hamilton heads for hibernation with a word of warning
-
Michael van Gerwen is hunting down a fourth World Championship title (Picture: Getty Images) Michael van Gerwen is Phil Taylor’s tip to lift the World Darts Championship trophy for a fourth time in January, expecting a backlash from the recent defeat in the Players Championship Finals. The 2024 World Championship ...
See Details:
Carolina Panthers fire head coach Frank Reich after 1-10 start to the season
-
Michael van Gerwen is hunting down a fourth World Championship title (Picture: Getty Images) Michael van Gerwen is Phil Taylor’s tip to lift the World Darts Championship trophy for a fourth time in January, expecting a backlash from the recent defeat in the Players Championship Finals. The 2024 World Championship ...
See Details:
This exercise is critical for golfers. 4 tips to doing it right
-
Michael van Gerwen is hunting down a fourth World Championship title (Picture: Getty Images) Michael van Gerwen is Phil Taylor’s tip to lift the World Darts Championship trophy for a fourth time in January, expecting a backlash from the recent defeat in the Players Championship Finals. The 2024 World Championship ...
See Details:
One in three households with children 'will struggle to afford Christmas'
-
OTHER NEWS
Kobbie Mainoo made his first start for Man Utd at Everton (Photo: Getty) The Football Association are reportedly confident that Manchester United starlet Kobbie Mainoo will choose to represent England ...
Read more »
Michael Smith will begin the defence of his world title on the opening night (Picture: Getty Images) The 2024 World Darts Championship is less than three weeks away and the ...
Read more »
For the first time a long haul commercial aircraft is flying across the Atlantic using 100% sustainable aviation fuel (SAF). A long haul commercial flight is flying to the US ...
Read more »
The King has met business and finance leaders from across the world at a Buckingham Palace reception to mark the conclusion of the UK’s Global Investment Summit. Charles was introduced ...
Read more »
After Ohio State’s 30-24 loss to Michigan Saturday, many college football fans were wondering where Lou Holtz was. In his postgame interview after the Buckeyes beat Notre Dame 17-14 in ...
Read more »
Darius Slay wouldn’t have minded being penalized on controversial no-call No matter which team you were rooting for on Sunday, we can all agree that the officiating job performed by ...
Read more »
New England Patriots quarterback Mac Jones (10) Quarterback Mac Jones remains committed to finding success with the New England Patriots even though his future is up in the air following ...
Read more »