9th Jul 2025 13:27
(Alliance News) - UK Prime Minister Keir Starmer has declined to rule out a wealth tax, after Conservative leader Kemi Badenoch accused the prime minister of "flirting" with the idea.
Starmer defended his record in government saying he is "proud" of the NHS 10-year health plan, free school meals and the roll out of family hubs.
During the back and forth at Prime Minister's Questions, Badenoch claimed "investors are fleeing the country" as a result of a potential "tax on aspiration".
This comes after former Labour leader Neil Kinnock suggested a wealth tax could "commend" the government to the general public.
She said: "He's flirting with Neil Kinnock's demand for a wealth tax. Let's be honest about what that means – this is a tax on all of our constituents savings, on their houses, on their pensions, it would be a tax on aspiration. Will the prime minister rule this out?"
Starmer replied: "What we did in the budget was stabilise the economy through the measures taken by the chancellor, what has that led to? Four interest rate cuts, for mortgage holders that is hugely important – compare and contrast what happened to the Liz Truss mini-budget.
"The fastest growth in the G7 in the first quarter of this year. Wages up more in the first 10 months of the Labour government than the 10 years under the Tories. So no, we don't need lessons from them."
Badenoch then said: "It is time for him to take responsibility for the mess he is making. He has been in office for a year, and all we see is him congratulating himself on what a fantastic job that he has done. Nobody out there believes it, not even them, not even them, what a weak cheer.
"He's congratulating himself. We can compare records. He talks about the fastest growing economy. We left him the fastest growing economy of the G7. We cut the deficit in every year until the pandemic. We got inflation down to 2%.
"On his watch, taxes are up, unemployment is up, inflation is up, and this weak Prime Minister has been forced into a series of chaotic U-turns."
She added: "Yesterday, the OBR (Office for Budget Responsibility) said that our economy is being eroded under Labour. Doctor strikes, tax bombshells, the wealthy leaving in droves, isn't the truth that under him, he is dragging us back to the 1970s?"
Starmer replied: "We're responsible for four million extra appointments in the NHS, we're responsible for a 10-year plan on the future of the NHS after they broke it, we're also responsible for free school meals being rolled out in a way which has never been done by any government, breakfast clubs being rolled out, family hubs being rolled out, transport across the country, and migration coming down.
"We take responsibility and we're proud of that.
Badenoch went on to accuse Starmer of planning to increase costs for the public, as she said any freeze to income tax threshold would mean pensioners have to pay a "retirement tax".
The prime minister had earlier said he stands by Labour's manifesto commitment not to raise income tax, national insurance or VAT.
Badenoch said: "He's talking about record investment and more jobs, we know that people are losing their jobs. Unemployment has gone up every single month since their year in office, but what does it mean on this issue of tax thresholds?
"It means that under Labour, millions of our poorest pensioners face being dragged into income tax for the first time ever. Does the prime minister think it is right that struggling pensioners should face a retirement tax?"
Starmer said: "We will stick to our manifesto commitments, we will stick to our fiscal rules. This is a language they don't understand. That's what got us into the problem in the first place."
By Rhiannon James, Will Durrant, and Harry Taylor, PA Political Staff
source: PA
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