Labour suffers rebellion as 20 MPs vote against Philip Hammond's income tax proposals

Jeremy Corbyn has been hit by a backbench rebellion
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Ella Wills1 November 2018
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Twenty Labour MPs have rebelled to oppose Philip Hammond's income tax changes, amid Opposition tensions over how to respond to the Chancellor's latest Budget.

Former ministers Yvette Cooper, Dame Margaret Hodge and David Lammy were among those Labour MPs who voted against the Budget resolution to raise the personal allowance to £12,500 and the higher rate threshold to £50,000 from April 2019, despite party orders to abstain.

MPs approved the proposal by 314 votes to 31, majority 283, as the Budget debate concluded after four days.

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 - majority 67

This proposal from the Opposition followed a heated row in Labour ranks after shadow chancellor John McDonnell said the party would not oppose Tory tax cuts for the middle class.

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.

A number of prominent Labour MPs called on the party to oppose the changes as they say they disproportionately benefit the better-off.

Ahead of the final day of debate, Labour MP Chuka Umunna told ITV's Peston: "No, I don't think these are the right kinds of things to be basically making a set of income tax changes which primarily benefit high earners. That's obviously wrong."

Mr McDonnell said Labour would not oppose the tax cuts as they would also benefit low and middle-income workers.

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