Labour's tax guarantee for earners on less than £80,000

The shadow chancellor is heading for a clash with opponents on tax as he unveils plans which are likely to mean increases for anyone earning more than £80,000 a year.

In a speech in east London, John McDonnell will promise what he calls a personal tax guarantee, which he says would protect low and middle income earners.

He will pledge that under a Labour government there would be no increase in the standard rate of VAT, income tax for those earning below £80,000, or personal national insurance contributions.

He will say only the highest earners, the top 5%, would be asked to pay more tax.

But his political opponents are accusing him of a tax raid on the professional classes. They claim anyone earning more than £80,000 would face a tax hike under Labour and that up to 1.2 million people could be hit.

Mr McDonnell's proposals also suggest he would bring back the 50p tax rate introduced by former Labour chancellor Alistair Darling and later scrapped by his Tory successor George Osborne.

In his speech, Mr McDonnell will say: "The choice at this election is very clear on tax, as there is currently only one party which is committing not to raise taxes on middle and low earners - and that is the Labour Party.

"If Labour is elected next month we will guarantee that for the next five years there will be no tax rises for income tax payers earning less than £80,000 a year, no hikes in VAT and no changes in your national insurance contributions either.

"The Labour Party is now the party of low taxes for middle and low earners, while the Tories are the party of tax handouts for the super-rich and big corporations."

His announcement comes only days after the Chancellor Philip Hammond, who was forced to abandon his Budget increases in national insurance contributions, accused Labour of a tax and debt bombshell. Critics also say there are holes in Labour's plans.

Attacking the shadow chancellor's pledge, the Treasury Chief Secretary David Gauke said: "Jeremy Corbyn will have to raise taxes because his nonsensical economic ideas don't add up and he'll make a mess of the Brexit negotiations.

"That's why he talked about raising the basic rate of income tax to 25p in 2015 - and the Lib Dems and SNP, who would prop him up, want to increase taxes too. Every family and business would pay the price for the tax and debt bombshell they would drop on Britain."

The Liberal Democrats' shadow chancellor, Susan Kramer, said: "Labour's so-called tax pledges aren't worth the paper they're written on, given their inability to form a proper opposition, let alone a government."