Chancellor Rachel Reeves told MPs on Wednesday that she had kept every manifesto commitment made by Labour, but her claim has been challenged by Conservative leader Kemi Badenoch. During a Commons debate on the Budget, Reeves said: “I have cut the cost of living – with money off bills and prices frozen – all while keeping every single one of our manifesto commitments.”
Responding immediately afterwards, Badenoch accused the chancellor of breaking a key promise. “Because taxing your home, your car, your savings and your pension was not enough, the chancellor has, by her own admission, broken her manifesto promise on income tax,” she said.
The Labour manifesto explicitly ruled out increases to national insurance, VAT and income tax. However, the Budget contained measures that critics argue effectively raise two of those three levies. The chancellor’s decision to freeze income tax thresholds is widely seen as a stealth tax rise, dragging more people into higher rates as wages grow.
Labour sources insist that the letter of the manifesto has been upheld, as no rate of income tax was increased. But the Office for Budget Responsibility has estimated that the threshold freeze will cost taxpayers billions over the next few years. The row is likely to dominate the coming weeks as both parties seek to frame the Budget as either responsible or dishonest.
