Our Government Tracker’s verdict on whether Labour has broken its manifesto commitments on tax

This week’s Budget has prompted lots of debate about whether the chancellor has broken or kept Labour’s manifesto commitments on tax. We wrote about this in detail in our fact check on Wednesday.

We’ve now updated our Government Tracker to reflect the news from the Budget—and we’re rating elements of Labour’s overarching pledge on tax as ‘Not kept’, even though the government has claimed to have kept “every single one” of its commitments.

In full, the headline pledge on tax in Labour’s 2024 election manifesto reads: “Labour will not increase taxes on working people, which is why we will not increase National Insurance, the basic, higher, or additional rates of Income Tax, or VAT.”

Exactly how this pledge should be interpreted has been the subject of much debate. There’s a lot to unpick, so our Government Tracker has been monitoring progress on four different elements of this promise separately—the commitments on income tax, National Insurance and VAT, as well as the wider commitment to “not increase taxes on working people”.

As a result of measures announced in this week’s Budget, we’re now rating the pledge to not increase taxes on working people as ‘Not kept’, because extending the freeze on income tax and National Insurance thresholds means that from April 2028 people will pay more in these taxes than they otherwise would have done. That’s a point the government itself has acknowledged, with the chancellor saying that the thresholds freeze extension “will mean that working people pay a bit more”.

We’re also rating the pledge to not increase National Insurance as ‘Not kept’, because although the government has argued Labour’s manifesto commitment to “not increase National Insurance” only applied to rates, the manifesto didn’t actually specify this, and the changes clearly mean many “working people” will pay more National Insurance in their payslips.

We’ve struggled to find an appropriate rating for the pledge to not increase income tax, because of the confusion around its original scope. There’s been no increase in the headline rates of income tax in people’s payslips, which is what Labour says the pledge applies to (and the wording of the manifesto does specifically mention “rates”).

But extending threshold freezes will mean “working people” pay more tax that they otherwise would have, and the chancellor has previously appeared to say this could breach Labour’s manifesto commitments. For now, we’ve ended up rating this pledge as ‘Unclear or disputed’.

And finally, because there have been no changes to VAT (aside from some specific changes in eligibility for VAT relief, and applying VAT to private school fees), we’re continuing to rate the pledge to not increase VAT as ‘Appears on track’.