Welsh Labour Commits to Income Tax Freeze
Welsh Labour leader Eluned Morgan has pledged to maintain current income tax rates in Wales if her party secures victory in the Senedd election scheduled for May 7. Since 2019, Welsh ministers have held the authority to adjust the three income tax rates within Wales but have yet to exercise this power.
On Monday, Morgan is set to reveal the details of her party's manifesto, emphasizing her commitment to addressing the cost of living crisis and ensuring that more money remains in the pockets of Welsh residents.
The upcoming election will see voters in Wales electing 96 members to the Welsh Parliament.
Income Tax Powers and Financial Impact
Currently, Welsh ministers can modify income tax rates established by the UK government but do not control the income thresholds at which the three different tax rates apply. The Welsh government and Senedd possess authority over 10 percentage points of each income tax rate.
The Institute for Fiscal Studies has projected that Welsh income tax rates will generate approximately £3.6 billion in revenue for the fiscal year 2025-26.
During her manifesto launch event in Swansea, Morgan is expected to highlight that the income tax freeze aligns with Welsh Labour's focus on mitigating the cost of living challenges and returning financial relief to the public.
Commitment to 'Real Help'
Addressing an audience comprising party members and candidates, Morgan will state:
"Today, I make a clear promise to the people of Wales: in the next Senedd term, a Welsh Labour government will not raise income tax.
Fairness starts with understanding the pressure families face, but fairness also means action.
This manifesto delivers real help with the cost of living.
We will cap single bus fares at £2 across Wales, we will keep the £1 fares for young people and free travel for over-60s, and we will create 20,000 new childcare places, expanding provision from nine-months-old so families can work and get on.
Fairness means making everyday life that little bit easier."
In addition to the income tax pledge, Morgan is anticipated to outline plans aimed at job creation, investing £4 billion in new hospital construction, addressing environmental concerns, and enhancing educational standards.
