General election 2019: Corbyn admits lower earners face tax hike under Labour

Jeremy Corbyn has admitted those on lower incomes could pay more tax under a future Labour government.

The Labour leader had previously insisted only the richest 5% of taxpayers, those earning about £80,000 a year or more, would face tax rises.

But he was forced to concede a plan to scrap a tax break for married couples would impact those earning less.

Mr Corbyn argued in a BBC interview that those affected would benefit from a higher living wage.

“They will also be getting improvement in free nursery provision for two to four-year-olds,” he added.

Challenged on the policy in an interview with Andrew Neil on Tuesday night, Mr Corbyn conceded couples in receipt of the marriage allowance would no longer receive a reduction in tax if he wins power next month.

“They won’t get the advantage, it’s actually taking away £250,” he said.

The tax break was brought in by David Cameron in 2015 to promote marriage, with stay-at-home mothers and women who work part-time expected to be the main winners.

It is available to married couples and civil partners with a combined income of under £62,500 in England, Wales and Northern Ireland, and up to £43,430 in Scotland.

In January 2019, the government said an estimated 4.2 million couples were eligible for the tax break – with a total of 3.2 million claiming it since it was introduced.

When Labour published its general election manifesto last week it said there would be no increases in VAT, income tax or national insurance for 95% of taxpayers, if Labour wins power on 12 December.

The pledge prompted a heated exchange on the BBC’s Question Time programme, which led to questions about whether earning £80,000 put someone in the top 5% of earners.

What is the marriage allowance?

The marriage allowance is a tax relief for married couples and civil partners that allows one partner to transfer part of their personal allowance to the other.

To benefit as a couple, the lower earner must normally have an income below their personal allowance, which is usually £12,500.

It reduces the couple’s tax bill by up to £250 a year.

Scrapping the marriage allowance was not in Labour’s manifesto, but was included in an accompanying document, the so-called grey book, setting out how the party plans to pay for its spending commitments.

In the interview with Andrew Neil, Mr Corbyn repeated that only people who earned more than £80,000 a year would see a tax increase.

He said scrapping the marriage allowance would be a “step towards equality” because “those people that are cohabiting in a very happy family atmosphere and bringing up children do not get the benefit of that”.

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Media captionJeremy Corbyn says restoring Waspi pensions would be be paid for from government reserves and long-term borrowing.

The half-hour interview also saw Mr Corbyn struggle to explain how Labour’s pledge to restore pensions to women born in the 1950s would be paid.

The policy’s estimated £58bn cost over five years would be paid for through government reserves and, if necessary, borrowing, “over some years”.

He conceded that there were not sufficient funds in the government’s reserves to cover the bill, but insisted the women deserved to be repaid.

“We will make sure they are compensated,” he said.

Mr Corbyn also declined to apologise to the UK Jewish community after the Chief Rabbi Ephraim Mirvis claimed the “poison” of anti-Semitism within Labour was “sanctioned from the very top”.

Andrew Neil will be speaking to other party leaders during the election campaign.