Member

With permission, Madam Chair, I shall dwell in a bit more detail on clause 12, which, for me, sums up the Labour Budget. Only Labour could increase spending by £70 billion a year over the next five years—the equivalent of a furlough scheme every year—and still have growth downgraded as a result. Only Labour could come up with a tax rise that loses money for the Exchequer. It is so bizarre that it is worth repeating. Clause 12 is a tax rise that loses money. Clause 12 increases the rate of capital gains tax applying to carried interest gains by as much as 14%, by applying a single rate of 32% in the 2025-26 financial year, after which Labour proposes to take carried interest out of the capital gains tax regime altogether. The Treasury’s own Red Book says that the measure will not raise a single penny in revenue. At the same time, HMRC has disclosed that the implementation of the measure, which impacts on only 3,100 individuals, will cost £4.5 million. To put it another way, the Government could have given every affected individual a tax cut worth £1,500 and the cost to the Exchequer would have been no different. That is total madness, and it is about the only measure in the manifesto that Labour has kept.