Labour budget plans labelled 'dodgy car hire tactics' and 'unwise' amid warnings of potential tax hikes

Speaking on the BBC’s Sunday With Laura Kuenssberg, Griffith argued that Labour “essentially lie to the British people in terms of their plans, not to increase national insurance… not to change the fiscal rules.”

He argued that the promises made by Labour during the election were misleading, saying: “Already after 110 days, I think people are seeing that this Government came in on a false prospectus that things would be easy.”

Griffith went on to criticise Labour’s definition of a “working person,” claiming it would leave many taxpayers exposed to new taxes. He warned that Labour’s approach could affect individuals across various income levels.

He said: “A nurse with an ISA, (or) a teacher with a second home” might not be considered a “working person” under Labour’s definitions and therefore could face unexpected tax hikes.

Former Bank of England Governor Mervyn King joined Griffith in questioning Labour’s tax strategy, describing it as “very unwise.” King argued that Labour’s commitment to maintaining tax thresholds on income tax, VAT, and national insurance would limit the government’s fiscal flexibility, a position he believes could be detrimental to funding essential public services.

King suggested Labour’s budget might ultimately need to undo these tax commitments to maintain economic stability. He said: “We’re going to put national insurance contributions back to where they were, because without that, we won’t have the money to support the NHS and other public services.”

He further warned that avoiding such reversals could force the government into making difficult trade-offs, potentially impacting public service funding and stability.

Director of the Institute for Fiscal Studies Paul Johnson expressed concern that even with potential tax hikes, public services could still feel strained under Labour’s economic plans. Johnson, speaking on Sunday Morning With Trevor Phillips, argued that “the biggest tax-raising budget… ever” might still leave key services like justice, local government, and social care without sufficient funding.

“Now part of the problem of course is the NHS is so big that… that still leaves other departments quite tight,” Johnson said, explaining that while Labour’s budget could see some tax increases, it might not provide enough financial relief across all essential sectors. His comments reflect broader concerns that Labour’s budget plans, while focused on growth, might lack the flexibility to meet the full range of public service needs.

Labour’s economic strategy has also drawn criticism from Reform UK Deputy Leader Richard Tice, who warned that Wednesday’s budget announcement could be “the most socialist budget in living memory.” Speaking to Sunday Morning With Trevor Phillips, Tice argued that Labour’s tax policies could stifle job growth and economic innovation by disproportionately targeting small businesses and entrepreneurs.

“We’re in a crisis. You can’t tax your way out of a crisis,” Tice said, asserting that economic recovery should be driven by growth and private enterprise, not increased government spending. Tice claimed that Labour’s approach would create “a bigger state, more bloated, more inefficient,” cautioning that expanding government control would have lasting negative effects on job creation and economic stability.

Despite criticism, Labour’s leadership has defended the Budget’s focus on long-term investment and stability. Education Secretary Bridget Phillipson has insisted that Labour’s approach seeks to "restore stability" and invest in "the long-term prosperity of our country.” Phillipson responded to concerns about the economic challenges facing the country, saying: “We face some tough choices, but we need to restore stability back to the economy.”

Labour is set to announce its Budget plans on Wednesday (October 30).