Tories may scrap pledge not to raise income tax

A senior Cabinet minister has suggested the Conservatives may scrap their pledge not to raise income tax, VAT or national insurance - a move that would leave the door open to tax rises if the party wins the general election.

Philip Hammond in Glasgow. Picture: John Devlin.

Sir Michael Fallon insisted the Tories are the party of “lower taxes” but admitted it does not want to commit to too many “prescriptive” targets in its manifesto, indicating that the “tax lock” pledge from the 2015 general election could be dropped.

Chancellor Philip Hammond was forced into a humiliating U-turn shortly after last month’s Budget when a revolt from backbench Tory MPs forced him to ditch planned national insurance changes for the self-employed.

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Theresa May has so far refused to repeat the “tax lock” pledge, while Mr Hammond said he needed more “flexibility” in managing the economy, prompting Labour to claim the Conservatives are planning a “tax bombshell” should they retain power after the general election.

Sir Michael said a review of the rights of self-employed workers would continue if the Tories win the general election, and echoed the Chancellor’s call for flexibility.

He told ITV’s Good Morning Britain: “I think what he (Mr Hammond) said is he doesn’t want too many targets inside the manifesto that are too prescriptive, that don’t allow you, as the situation develops over the lifetime of the Parliament, that don’t allow you the flexibility.”

Asked if the Tories would recommit to not raising income tax, VAT or national insurance, Sir Michael said: “The manifesto will certainly make clear which side of this argument we’re on - it’s Labour governments that increase tax, it’s Conservative governments that take the lower paid, in particular, out of tax.”