Rachel Reeves brands Rishi Sunak a liar over £2,000 Labour tax rise claim during North East visit

Labour's shadow chancellor Rachel Reeves visiting Teescraft in Bishop Auckland
-Credit: (Image: Newcastle Chronicle)

Labour’s shadow chancellor branded Rishi Sunak a liar during a visit to the North East, amid a major row over tax hike claims.

The Prime Minister alleged repeatedly during Tuesday night’s televised election debate with Sir Keir Starmer that Labour’s policies would result in tax rises worth £2,000 per household – and said the costings had come from “independent Treasury officials”. But it emerged the following morning that the Treasury’s permanent secretary, James Bowler, said impartial civil servants were not involved in producing the £38 billion calculation and that ministers had been told not to present them as such.

Speaking to the Local Democracy Reporting Service during a campaign stop in the target seat of Bishop Auckland on Wednesday, shadow chancellor Rachel Reeves called on the PM to “explain why he thinks he can get away with lying”. She said: “Rishi Sunak lied in those debates last night. He lied on 12 occasions.

“I have been really clear – working people are already paying too much in tax and that is why I have made the commitment that, for the duration of the Parliament, Labour will not increase National Insurance, income tax, or VAT.

“The Prime Minister’s claims are lies and he has been found out. Today the most senior civil servant at the treasury has been really clear that these numbers were not signed off, produced, or published by Treasury officials.

“The Prime Minister now needs to explain why he thinks he can get away with lying and, indeed, why the tax burden has reached its highest levels in 70 years while he has been Prime Minister.”

The tax rise claim comes from a document produced by the Conservatives which makes a series of assumptions about Labour’s policy plans, which it claims would result in a deficit of £38.5 billion over four years.

Labour's shadow chancellor Rachel Reeves visiting Teescraft in Bishop Auckland with Sam Rushworth and Kim McGuinness
Labour's shadow chancellor Rachel Reeves visiting Teescraft in Bishop Auckland with Sam Rushworth and Kim McGuinness -Credit:Newcastle Chronicle

But Mr Bowler said in a letter to Labour’s shadow Treasury chief secretary Darren Jones that the total “includes costs beyond those provided by the Civil Service”, adding that costs from other sources “should not be presented as having been produced by the Civil Service” and that he had “reminded ministers and advisers that this should be the case”.

Mr Sunak repeated his allegation that Labour would deliver a £2,094 tax rise on social media on Wednesday, while energy secretary Claire Coutinho also said the figure was based on Treasury calculations.

On Times Radio, Ms Coutinho claimed “this is something which has been signed off by the permanent secretary of the Treasury”, adding “those costings have been done by independent Treasury civil servants”.

Ms Reeves was joined on a tour of engineering company Teescraft’s Bishop Auckland factory by North East mayor Kim McGuinness and Parliamentary candidate Sam Rushworth on Wednesday afternoon.

She spoke again of Labour’s ambition to create a huge number of jobs in green industries in the region, claiming that 35,000 new jobs could be created in sectors including offshore wind – an increase on the 27,000 she had previously announced on a trip to Darlington in February.

Talking up plans to create a publicly-owned clean energy company, GB Energy, and extend a windfall tax on oil and gas giants, the shadow chancellor added: “We would plough that money into jobs in low-carbon and zero carbon industries, like carbon capture and storage and also floating offshore wind. I was meeting with Kim McGuinness today to talk about the potential for that in the North East of England and we believe under our plans we can create 35,000 new jobs here in those industries.

“That is a promise that this Conservative government are not able or willing to make – that is one crucial difference between what we offer and what they offer.”