Is Labour’s opposition to corporation tax rises indefensible?

Labour’s opposition to the chancellor’s planned corporation tax rises has been attacked by some of its own left wing. But is there an economic logic to it? Ben Chu investigates

Keir Starmer campaigned for the party’s leadership on a pledge to ‘reverse the Tories’ cuts in corporation tax’ (EPA)

It has been heavily briefed out to the media that the chancellor is planning to raise corporation tax rates in next week’s Budget as a way of helping to restore stability to the public finances in the wake of the coronavirus pandemic and reversing some of the deep cuts in the levy imposed by Conservatives over the past decade.

But Labour has signalled that it would oppose such a move.

“This is not the time to do that,” said the party’s shadow chief secretary to the Treasury, James Murray, on the BBC this week.