Ordinary families would be forced to pay double the amount of tax if Labour introduced a Universal Basic Income.
This week the shadow Chancellor John McDonnell confirmed that Labour was persisting with the policy, and insisted that he would ‘win the argument’ on Universal Basic Income. Labour leader Jeremy Corbyn revealed he was considering Universal Basic Income, following comments made by John McDonnell suggesting it could be in the Labour Party’s manifesto at the next General Election at the launch of a report on Universal Basic Income by Compass.
Under the controversial scheme, which would cost £210 billion annually, a full-time worker on the average salary of £27,600 would see the amount they pay in tax increase from £3,320 to £6,900, leaving them £3,580 worse off a year.
Compass, the authors of the report backed by the shadow Chancellor, conclude that the proposed Universal Basic Income scheme would be paid for by increasing income taxes by 5 per cent and scrapping the £11,000 personal tax-free allowance.
Member of the Treasury Select Committee Chris Philp said:
‘Labour’s latest economic experiment would see the pay packets of ordinary families raided.
‘Whoever wins Labour’s leadership election, it is clear that the British people will be the losers, as Labour will spend, borrow and tax even more than they did last time.
‘Labour are divided, incompetent and a risk to our economy – and ordinary families would pay the price.’