The Tories have accused the Government of hiding behind an “alibi” over the increase to national insurance for employers.
New shadow chancellor Mel Stride claimed the Labour Party had breached its manifesto as a result of the policy which was set out in the Chancellor’s Budget last week.
From next April, employers will have to pay national insurance at 15% on salaries above £5,000, instead of 13.8% on salaries above £9,100 currently.
“And when they were pressed as to what they would be doing in terms of tax rises, they ruled out a large number of taxes, and one of those was national insurance.”
“And yet, just some short weeks later, in this Budget, what has happened? We have seen employers’ national insurance raised, a direct contravention, breach of their manifesto,” he added.
Mr Stride went on to say: “Of course the Government has since hidden behind their alibi at the scene of this crime.
“That somehow the measure they have taken, the measure they have taken in respect of putting up national insurance for employers, is in some way not going to have any impact, any impact on working people. That is simply untrue.”
Liberal Democrat MP Vikki Slade told MPs an early years nursery in her constituency will have to pay half a million pounds more each year because of the employers national insurance increase.
The Mid Dorset and North Poole MP criticised the “short-sightedness” of some of the Budget, saying: “It is true that the average worker won’t see a tax rise on their payslip. But their employer will now be calculating whether there will be any pay rises at all next year, or whether to issue some of their workers with their P45s.”
She added: “Corfe Mullin Dental Practice recently recruited a graduate dentist specifically to serve the child NHS population, boosting capacity in my area. The increase in NI for the staff has wiped out half of her annual salary, and if we are going to stop dentists leaving the NHS we need exemptions for them now.
“Julia’s House Children’s Hospice has calculated their NI increase is £242,000 a year, and shockingly Tops Nursery, which has several early years settings in my constituency, has calculated half a million pound increase without any additional increase in childcare funding.”
Elsewhere during Monday’s Budget debate, Labour MP Clive Efford called on the Government to “go further” in tackling the “imbalance” of wealth in the UK.
“Over the last 14 years the Conservatives have done nothing to address this imbalance, and we must recognise that we do not tax wealth in the way that we tax work, and this has created an intolerable level of inequality.
“The wealth of the richest has risen from three times the national income, to almost eight times since the 1980s.”
He added: “This is not the politics of envy, it’s just logical. If we do not appoint an appropriate proportion of the wealth created by our nation into our public services and our infrastructure, into our universities and research, into police and our courts, and much more, we diminish our country.”
Earlier on Monday, opposition MPs called on the Government to reverse the “devastating” change to farmers’ inheritance tax.
During an urgent question, the Conservative MP for Bridlington and The Wolds, Charlie Dewhirst, urged the Government to withdraw its plans which have “shattered” farmers.
He added: “I’m afraid this is a Budget that stands in its entirety, and the whole country needs stability, so it will stand.”
Conservative former minister Kevin Hollinrake said the move is a “transition from family farms to the state” justified by “warped socialist ideology”.
The minister earlier pledged the Government’s “unwavering” support for farmers and rural communities.
Meanwhile, Reform UK MP Richard Tice (Boston and Skegness) said: “The heads of farming families in their 80s and 90s are seriously considering committing suicide before this policy comes into place.”
Mr Zeichner replied: “I find it hard to respond to a question like that, I spoke earlier about using language carefully and I would just reiterate that.”
Treasury Minister Emma Reynolds told the Commons that a couple who jointly own a farm will be able to pass on land and property worth £3 million to a child or grandchild, tax free. “I hope that gives some comfort to members across the house,” she said.
Ms Reynolds added: “We shun the choices of the last… government. They chose low growth, low productivity and decline in our public services.
“We choose investment and growth, restoring economic stability, fixing the foundations, rebuilding the NHS and our other public services, pushing forward with a decade of national renewal, recruiting more teachers, bringing down NHS waiting times, building more affordable homes, and yes, filling more potholes.”
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