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Labour targets Commons votes on 50p tax, 'Granny tax' and 'pasty tax'

Ed Balls wants to overturn the so-called 'Granny tax', the abolition of the 50p tax rate and the 'pasty tax' in a series of Commons votes. Photo: PA/PA Wire

Labour will attempt to defeat the "granny tax", the "pasty tax" and the abolition of the 50p tax by calling a series of Commons votes, it said tonight.

Shadow chancellor Ed Balls insists it is not "too late" to reject the unpopular Budget measures and is calling on disgruntled coalition MPs to back the party's bid.

In an article for The Sun on Sunday Mr Balls said "it's not right and it's not fair" that the highest earners will benefit from the reduction in the top rate of income tax while millions of pensioners will be left worse off by Chancellor George Osborne's measures.

He is also demanding a Government rethink on the "daft" plans to impose 20% VAT on pasties and other hot food.

Mr Balls wrote:

There are two Budget decisions that aren't too late to stop.

The £3 billion tax rises on pensioners - the so called granny tax - which George Osborne announced last month does not kick in until next year.

Nor does the £3 billion handout which he announced for people earning over £150,000, when he cut the 50p top rate of income tax.

That's a tax cut of over £40,000 for 14,000 millionaires.

How out of touch are David Cameron and George Osborne if they think millions of pensioners who've worked hard all their life should have to pay more tax next year so that millionaires can pay less?

And we'll demand that the Government thinks again on its daft plan to slap 20% VAT on pasties, sausage rolls and even hot cross buns - and other things which have traditionally been VAT-free, including caravans and building work on churches.

Two weeks ago Balls told ITV's Daybreak that his party was "baffled" by Osborne's budget:

The Chancellor insists no pensioner will lose cash as a result of the scrapping of age-related allowances.

But the Treasury acknowledged that 4.5 million pensioners would lose out in real terms as a result of the decision to phase out the relief.

Under the Chancellor's plans, the allowances will be withdrawn for new pensioners from April next year while existing pensioners will have their allowances frozen at £10,500 for the over-65s and £10,660 for the over-75s until overall tax thresholds catch up with them.

Labour is tabling a series of amendments to the Finance Bill later this month.

The party was mocked when many of its MPs missed a vote last month on the move from a 50p levy on the highest earners to a 45p rate.

But the party insists that vote would have wiped out all income tax and is instead attempting to force a vote on removing the new rate.

Mr Balls added:

The Government's economic policies are failing. From this week working families are paying the price. And next year pensioners will be hit hard as millions are asked to pay more, so that millionaires can pay less.

Tory and Lib Dem MPs who are still in touch with what life is like for their constituents should admit Cameron and Osborne have got it wrong this time.

They should vote with us to stop the granny tax before it's too late.