The shadow chancellor has attacked a think tank which said that the party’s plan to raise almost £50 billion from higher taxes for companies and the very wealthy “doesn’t add up”.
Paul Johnson, director of the Institute of Fiscal Studies (IFS) told BBC Radio 4’s Today programme, that Labour wouldn’t be able to raise £49 billion as it claimed because companies would find ways to avoid a corporation tax increase or simply invest profits elsewhere.
He said that the party had also made “some errors in their numbers”, including how much they could bring in by stopping tax avoidance.
Mr Johnson added that Labour’s proposals would “take tax in the UK to its highest ever level in peacetime” and did not add up.
“In the short term you might get £30 billion or £40 billion . . . but in the long run you would probably be reducing investment,” he said. “So you can get quite a lot from companies but you can’t get that much.”
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In a BBC radio interview a few hours later John McDonnell, the shadow chancellor, rejected the analysis of Labour’s figures and said that the IFS “was not infallible”.
“They did get it wrong with the economic crisis, they got it wrong with closing the deficit by 2015, they got it wrong last year on business investment — and I think they’ve got it wrong this time as well,” Mr McDonnell said.
He said that companies would not be able to find ways to avoid corporation tax increases because the party would act against avoidance and evasion.
He denied that the proposed tax increases were extreme, saying that they would leave Britain “in the middle range of other European countries and other countries when it comes to tax levels”. He said that the dispute with the IFS was over “about £9 billion” while the Conservatives had provided no figures in their manifesto.
Mr McDonnell also seized upon a report by the Organisation for Economic Cooperation and Development which said that the UK economy would slow because of uncertainty about Brexit. The shadow chancellor described that as a “hammer blow for the Tories’ economic credibility”.
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Yesterday Jeremy Corbyn made his final pitch to voters before polling day with six rallies across the country.
The Labour leader ticked off Scotland, Wales and England, starting his first stump speech at 8am in Glasgow and he was scheduled to finish 13 hours later on his home turf of Islington, north London.
In between he stopped off to address activists and voters in Halton, Cheshire, Colwyn Bay, north Wales, and Watford and Harrow in southern England.
He was greeted by hundreds of supporters, many carrying placards and wearing pro-Corbyn T-shirts at each venue. In Glasgow he expressed optimism about his chances in the election today and insisted that he could win. “They underestimated us didn’t they?” he told the crowd. “They underestimated the good sense of ordinary people, ordinary people all over Britain.”
He added: “If you want a Labour government, if you want to get rid of a Tory government, our party is not doing deals, we’re not offering anything other than us, our manifesto and our principles. This campaign is very exciting, exciting because of all the people who have come on board to support and help our campaign.
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“It is that sense of unity that will deliver something very historic tomorrow across the UK.”
Later on a beach in north Wales he stressed his environmental credentials with a swipe at President Trump for pulling out of the Paris climate change accord. “We all live on one planet, there isn’t any other planet. And if we don’t look after it and protect it, it won’t be there, our future will not be there. It does mean a government that is interested and serious about supporting and protecting our natural environment,” he said.
In Runcorn, the Labour leader faced heckles as Tony Gobin, 54, who said that he was a Corbyn supporter, shouted: “What about terrorists?”
Mr Gobin said that he would cast his ballot for Labour, as he always had, but wanted all party leaders to say more about how they would deal with terrorism after three attacks in Britain in three months. Mr Gobin said: “I believe in him, I just want him to go all the way and try and stop it, for our kids and grandkids. It’s got to be answered, it’s got to be spoken about.”
Reflecting on the campaign, Mr Corbyn said that he forgave people who had said “nasty things” about him in recent weeks.
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While Theresa May flew from Southampton to Norfolk on a private jet for the final push of the campaign, Mr Corbyn said: “I don’t have a private plane, I don’t have a helicopter.
