Keir Starmer has promised not to raise taxes on ‘working people’. But who, exactly, is a working person? The definition, it turns out, is not so simple. Or rather, Starmer has particular characteristics in mind that might not line up with how others would interpret that phrase.
Speaking on LBC yesterday, Starmer laid out his definition of a working person he would shield from tax rises: ‘people who earn their living,’ he said, who ‘rely on our [public] services and don’t really have the ability to write a cheque when they get into trouble.’
It’s the kind of answer that leads to more questions. In the UK practically everyone (regardless of how well-off they are) will be dependent on certain public services, including the NHS which is the only practical way to access an ambulance or certain emergency services.
The ability to write a cheque when in trouble might not be a sign of your income level, but how much cash a person has on hand at any given time. Does a person with a multi-million-pound property, whose cash is eaten up by a large mortgage every month, fit this definition?
The definition also seems to leave out large groups of people, including pensioners. Or today’s savers. Is a lower cap on ISA accounts being considered? And what about distinctions between workers: is a landlord, who rents out and manages several properties to produce their income, a ‘working person’? If so, that might rule out additional taxes on second homes. If not, that tax – under Labour’s definition – remains on the table.
There seems to have been an attempt today to roll back some of Starmer’s specificity (or arguably vagueness). The shadow chancellor Rachel Reeves gave Sky News a far more basic definition: ‘working people are those people who go out and work and earn their money through hard work,’ she said. This seems more in line with what Labour has ruled out so far: increases to income tax, National Insurance and VAT. But there is clearly still a subjective element to this definition, especially around what constitutes ‘hard work’.
My Labour government will make sure that working people like those I met today in @Morrisons are better off.
— Keir Starmer (@Keir_Starmer) June 19, 2024
Our first steps will deliver economic stability, putting more money back in your pocket.
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Despite Reeves’s attempt to provide some clarity, the Labour leader seems to be drawing attention to the debate, tweeting out this afternoon an example of the ‘working people’ he referenced. In this case, staff workers at a Morrisons. No doubt everyone would agree these workers should be recognised for their efforts. But the implication seems to be that Labour is going to be comfortable determining who in work is deserving of the title. Everyone would include doctors and nurses on that list – but what Labour thinks of the role of the landlord, for example, might matter more than the amount of time or effort any individual landlord is actually putting in.
The attempt to understand Starmer’s definition is really another attempt to get to the bottom of Labour’s tax plans. Despite ruling out big revenue raisers, the party has kept its options open when it comes to raising most taxes. By not mentioning specific taxes in the Labour manifesto, it means it is possible to raise them later.
There is growing pressure for Labour to level with the public about what it plans to do in power. But the party only has to hold out for a few more weeks. Time is working in Labour’s favour.
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