Labour frontbencher refuses to rule out higher taxes on flying

Jonathan Reynolds
Jonathan Reynolds insists Labour has completely ruled out a council tax raid on middle-class homeowners - Thomas Krych / Story Picture Agency

A Labour frontbencher has refused to rule out higher taxes on flying as he said he would not write future budgets during the general election campaign.

Jonathan Reynolds, the shadow business secretary, opened the door to an increase in the air passenger levy as well as a potential hike in fuel duty in the future.

Labour has ruled out any increases in income tax, National Insurance and VAT but refused to do the same for a number of other taxes.

In an interview with Good Morning Britain, Mr Reynolds insisted the party comprehensively set out how its plans would be funded in its manifesto, which was unveiled last week.

“I’m saying all you need to do to look at where the revenue will come from, is look in the manifesto,” he said.

“There are specific ways we would raise money that would go into public services.”

However, when it was put to him that he could not rule out raising capital gains tax or an increase to fuel duty or air passenger duty, Mr Reynolds said: “We’re not going to write a budget for a few years’ time during a general election campaign.

“But we’ve been absolutely clear where revenue will come from to pay for public services, and absolutely clear about the argument we’re making, which is for a stronger economy.

“It benefits all parts of the country, that is our industrial strategy, our green prosperity plan, these are tangible measures that will make a difference.”

Labour came under fire last year after calling on ministers to reverse their plans to cut air passenger duty on domestic flights in half, from £13 to £6.50.

The party said the cut was “baffling” and a “failure to spend public money wisely” despite it representing savings for fliers amid the cost of living crisis.

Rachel Reeves, Labour’s shadow chancellor, has repeatedly refused to rule out raising capital gains tax, as has Wes Streeting, the shadow health secretary. The party was however forced to rule out introducing the levy on the sale of family homes.

Council tax bands

It came as Mr Reynolds insisted Labour had completely ruled out a council tax raid on middle-class homeowners by creating new bands for higher-value properties.

Ms Reeves and Darren Jones, the shadow chief secretary to the Treasury, could not guarantee new council tax bands would not be created when challenged on the issue earlier this week.

But when asked whether Labour would revalue council tax bands, Mr Reynolds replied: “No, we have this week said that’s not part of our plans. We’ve laid out all of our revenue raising measures in the manifesto, there are things that would produce an immediate cash injection into public services.”

Jonathan Reynolds speaks on Good Morning Britain on Tuesday
Mr Reynolds says Labour will not revalue council tax bands

Asked whether the official opposition had closed the door to the idea, he said:  “Yes, we’ve made that statement this week.”

Mr Reynolds also refused to be drawn on whether a Labour government would introduce any tax-raising measures that were not in the party’s manifesto.

“The premise of these questions is that the economy cannot grow any faster than it has done for the last 14 years and therefore the only way to fund public services is tax rises.

“We reject that case entirely, that’s exactly what the Labour manifesto makes the case against, that we can do better than we’ve done for the last 14 years.”

He added there would be “difficult decisions” if economic performance did not improve but said the opposition party was “absolutely confident in the measures that we’re putting forward”.

The Resolution Foundation, a Left-of-centre think tank, has warned the costings in Labour’s manifesto meant the party would oversee five years of tax rises and spending cuts if elected.

In contrast to the Tory dossier, which promised £17 billion of tax cuts, Sir Keir’s plan for government includes £8.6 billion of tax rises.

These include an expanded windfall tax on oil and gas giants, a move to completely abolish non-dom tax status by closing existing loopholes and the introduction of 20 per cent VAT on independent school fees.