Wigan MP defies party whips over tax cuts for high earners

Lisa Nandy MP
Lisa Nandy MP

Wigan MP Lisa Nandy joined a rebellion against the Labour Party whips to oppose tax cuts for middle and high earners in the Budget.

Ms Nandy was one of 20 MPs from the party to break ranks and oppose the resolution to raise the personal allowance to £12,500 and the higher rate threshold to £50,000 from April 2019.

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Labour Party parliamentarians had been ordered to abstain on the vote.

The rebellion did not succeed in derailing Chancellor Philip Hammond's policy as 31 MPs in total voted against it, giving those in favour of majority of more than 200.

However, the MPs standing up to the whips shows there is some unease in Labour ranks after shadow chancellor John McDonnell said the party would not oppose the tax cuts for the middle classes put forward by the Conservatives.

Ms Nandy said: “When a third of Wigan’s children are growing up in poverty it is simply immoral for the Tory Government to hand tax cuts to people earning £100,000.

"The Chancellor is spending £2.8bn on tax cuts that overwhelmingly favour the better off, while hundreds of working families in Wigan will see their tax credits frozen next year.

"Every week my surgery is packed with people bearing the brunt of these decisions. I could not possibly support them in Parliament.”

Speaking on TV about the budget this week Ms Nandy made it clear she fully backed Mr McDonnell's overall financial and taxation plan but disagreed with the party leadership that the tax cuts were worth supporting as it offered some limited help to those on lower incomes as well.

Under Mr Hammond's Budget plans the personal allowance, which is the maximum amount someone can earn before paying tax, will rise to £12,500 from £11,850.

The higher rate threshold - the income at which someone becomes liable to pay the 40 per cent tax rate - will rise to £50,000 from £46,350 at the same time.

During the Budget debate Labour also put down an amendment which sought to press for a hike in income tax to 45 per cent on earnings above £80,000, and 50 per cent for those above £125,000, although this was defeated by 313 votes to 246.