Ed Balls has mocked the Conservatives’ plan to legislate against rises in income tax, VAT or national insurance in the next parliament as a “ridiculous gimmick”.
The shadow chancellor said such promises from David Cameron were “two a penny” and completely meaningless, given there was already an annual vote on tax changes.
Cameron’s plans involve a five-year “tax lock” to be included in new legislation, which would guarantee no increases in income tax rates and VAT, nor an extension of its scope as well as no increase in national insurance and its ceiling above the higher rate threshold.
However, Balls pointed out that Cameron broke a pledge not to raise VAT in the last parliament and ignored his own legislation promising to balance the books by 2015.
“The rules are made by parliament and there is a finance bill every year,” Balls told BBC Radio 4’s Today programme. “It is such a ridiculous gimmick. He legislated in the last parliament to balance the books by 2015 and he failed to balance the books. These promises from David Cameron are two a penny.”
Balls also said people had been “bitten hard” by Cameron in this parliament and should be “once bitten, twice shy”.
Earlier, William Hague, the former foreign secretary, told the programme that by enshrining the tax lock in law the Conservatives showed they were different from Labour. “The difference is actual legislation to put it into the law of the land that there will be no income tax, no VAT increase during the next parliament and that of course not only underlines the commitment but would make it much more difficult for somebody to change that commitment over the next five years,” he said.
He declined to guarantee that child benefit and tax credits would also be protected. The Labour leader, Ed Miliband, will warn in a speech on Wednesday morning that these benefits would not be safe under the Tories.
Labour has already promised not to increase VAT or national insurance, but it would like to raise the top rate of income tax for the very highest earners to 50p in the pound.
Cameron will formally unveil his “triple lock” on tax on Wednesday. He will say: “This is the clearest choice on the economy for a generation. And beyond the plain facts, it also comes down to gut instinct. When you’re standing in the polling booth, ask yourself: on the things that matter in your life, who do you really trust?
“When it comes to your tax bill: do you trust the people who taxed you to the hilt when they were in power and still haven’t come clean about the taxes they want to increase next time round? Or do you trust the Conservatives, who have cut income taxes for 26 million people and who will cut your taxes again next time?”
The clear Labour commitments on tax have undermined Tory efforts to reprise the success of their 1992 election campaign, when the party warned that the then shadow chancellor, John Smith, was planning a series of tax “bombshells” on middle Britain. But the Tories hope that their record in office will help persuade voters that they can be more trusted on tax.
