One of Labour’s most contentious policies is their punitive tax on independent schools, slapping a 20% VAT on fees. The party is already stumbling over questions about how they’ll handle the influx of students flooding the state system. Shadow cabinet members are scrambling to refute Emily Thornberry’s slip admitting there will be “larger classes” because of this tax. Guido has unearthed a video of Deputy Leader Angela Rayner and the Shadow Chancellor vowing to abolish independent schools altogether…
Back in 2018, speaking at the Brudenell Social Club in Leeds about “Labour’s vision for a fairer future for everyone involved in teaching and learning,” Rayner promised: “we will end the marketisation and privatisation of our education system.” She was met with much applause from the audience and a nodding smile from Rachel Reeves. This would be a financial and logistical disaster…
According to an IFS report in 2019, shutting down private schools would saddle taxpayers with a £3.06 billion bill to shoehorn these students into state schools. On top of that, it would strip away £4.12 billion in tax revenues. Are Rayner and Reeves to fulfil their promise of abolishing private schools? The tax on fees could just be the beginning…
Lucy Powell’s aide gets in touch to complain about Guido’s article this morning saying that she alluded to VAT cuts last night at the Kebab awards. She might be in Reeves’ doghouse..
Afternoon,
I’m writing to complain about your piece about Lucy at the Kebab Awards and to ask you to correct the piece about alluding to VAT cuts. She did no such thing in her speech and your piece is incorrect. Lucy was speaking about what Labour was promising, on business rates etc, and in that context was talking down the prospect of any cut, not talking it up, saying it was a matter for Rachael and she runs a tight ship.
Lucy was not alluding to anything, it’s not what she said, or the impression she was giving. She gave a list of things she said Labour would do, and then something we were not (VAT). You have taken her words out of context, and the tone they were said in. She was saying she heard the business owners generally after some difficult years. Despite your reporting she hadn’t had a drink either.
I’d be grateful if you’d amend this piece to make it clear that she was not hinting about any VAT cut.
Thanks very much
Advisor to Lucy Powell MP | Shadow Leader of the House of Commons
Nearly four hours after the event started, Lucy said this in her speech in response to Ibrahim Dogus’ earlier call for VAT cuts:
“I hear what you say about VAT. I can’t stand here and promise that because any of you who know the Shadow Chancellor Rachel Reeves will know I’m absolutely not allowed to tell you that. But I hear what you’re saying anyway”.
The dictionary definition of “allude” is “to call attention to indirectly; hint at.” Well she definitely called attention to VAT. Co-conspirators can watch the video and decide whether or not Powell had a drink…
Guido has been reporting on the Office for Budget Responsibility’s (OBR) pattern of appointments for quite some time. They’ve just added yet another left-leaning, high-taxing adviser to their advisory panel.
Rita de la Feria is a left-wing professor of law, and self-proclaimed tax law virtuoso. She claims she inspired Uzbekistan to adopt her “progressive“ VAT system, which involves charging VAT on everything, burdening the majority of people with yet more taxes – and then getting the poor to reclaim VAT. She believes – according to her tweets, Corbyn asks the right questions, she was jubilant when Farage lost an election – accusing him of advocating the politics of fear. She of course describes Farage and Trump as “the extreme right”. Unsurprisingly, de la Feria is fervently anti-Brexit, complaining particularly about the perceived loss of tax revenue due to Brexit. One would think that fewer taxes on goods during a cost-of-living crisis would be a welcome development, apparently not in her book, which by the way is titled “Taxation and Inequality”.
The appointment of de la Feria stands as yet more evidence of the OBR’s ideological group-think. They’re proving yet again they have an agenda which is reflected in the mindset of the people they hire.
“I’ll give you this assurance, they will continue with the same programme, cutting taxes, simplifying regulation as much as possible, taking advantage of all our new regulatory freedoms, getting rid of every encumbrance from solvency to MiFID to VAT on fuel – turns out to be easier than we thought.”
Anyone else starting to get the sense the Tories are really going to miss this guy?
Rishi Sunak has been calling tax cut promises by other candidates “a fairytale”, going as far as to call Truss’s plans to use fiscal headroom to deliver £30 billion of cuts “immoral”. So what was it about the polls stubbornly refusing to move in his favour that caused him to pull off a “screeching U-turn” last night and announce a new policy to scrap VAT on energy bills next year? At a cost of £4.3 billion…
His new proposals will kick in if the energy price cap rises above £3,000, as is expected, allegedly saving the average household £160 by shifting the bill onto the national debt to be paid off by the next generation. Something he claimed previously was immoral. Not only did this announcement tonally represent a change of strategy, it particularly jars with an answer he gave to an audience member during Monday’s BBC debate. Where he repeatedly refused to commit to help until we learnt for certain what the new energy cap will be:
“We’ll have to see what the price cap actually is when we get there, as we heard we don’t know quite where it’s going to be… I think we’ve had this problem where we know energy bills are very volatile and we need to actually now see where they’re going to end up at.”
More awkwardly, in February Rishi took to the Commons to denounce the policy – then suggested by Labour – as it would “disproportionately benefit wealthier households”
“There would be no guarantee that suppliers would pass on the discounts to all customers, and we should be honest with ourselves: this would become a permanent Government subsidy on everyone’s bills, a permanent subsidy worth £2.5 billion every year, at a time when we are trying to rebuild the public finances.”
Last night Liz-supporting MP Mark Jenkinson really stuck the knife in – by tweeting the infamous scene of Theresa May shouting “Nothing has changed!”
The cost of living crisis is finally hitting parliamentarians where it hurts, after it was announced that there will be a catering service price hike across the estate from October 1st. A sign erected in PCH this morning explains that VAT will increase on food items from 5% to 12.5% “… with the exception of milk, fruit and sandwiches”. The sign also warns that VAT will return to 20% from 1 April 2022. Won’t be long before the electricity starts cutting off…
