The Labour Party announced in its manifesto they will seek to increase the tax all limited companies must pay against their profits. While Shadow Chancellor John McDonnell defended the party policy, the Institute for Fiscal Studies (IFS) has warned the proposals put forward by the Opposition would increase taxes for "millions" of people." As Labour MP Lucy Powell insisted only the top five percent would see a tax increase under her party's plans, broadcaster Julia Hartley-Brewer rejected her claims: "We’re not having an honest debate about this.
"There’s a perfectly valid argument for increasing the public services and the percentage of what is financed by the state in this country.
"The IFS has made it very clear that, actually, the sort of levels of public spending the Labour Party are talking about bringing in are actually quite average among Western European countries.
"However, as the IFS has also pointed out not any of those countries, whether it be France or Scandinavian countries, funds them just from corporation tax, other business taxes or the top five percent."
Ms Hartley-Brewer added: "They have across the board much, much higher levels of taxation across the whole population."
During an extensive comparative analysis of some of the major parties’ manifestos, the IFS highlighted several flaws in Labour’s plans, including its flagship nationalisation programme.
The Opposition has outlined a vision to increase public spending to an estimated £73 billion by 2023-24.
But the research from the independent economic think-tank concluded the policy cannot be delivered.
IFS Director Paul Johnson warned the proposals Mr Corbyn put forward last week would have "millions" of Britons paying more in taxes while also have the national debts increase amid prolonged Brexit uncertainty.
Mr Johnson said: "Under Labour, both taxes and spending would rise to peacetime highs.
“On generous assumptions, they would see the national debt rise by around 3 percent of national income.
"It is highly likely that Labour, at least over the longer-term, would need to implement other tax-raising measures in order to raise the £80 billion of tax revenue that they want and even just sticking to those proposals they would clearly increase taxes for many millions outside the top 5 percent."
He added: “In reality, a change in the scale and scope of the state that they propose would require more broad-based tax increases at some point.”
Boris set to SMASH Corbyn with massive victory as voters abandon Labour [POLL]
Labour leader drops out of television debates after horror BBC interview [INSIGHT]
'What’s the point? We’re leaving!' Brexit Party MEP mocks EU for threatening UK [VIDEO]
Mr McDonnell insisted 95 percent of the British population would not be affected by the changes to the taxation system the Labour Party is planning to implement in the event of an election victory.
Speaking to the BBC last week, Mc McDonnell said: “What we’re saying is that, with the structural changes we will make in the economy, we’ll make sure the corporations themselves do not take that easy option of cutting wages or rising prices.
"Actually, because we are democratising the way in which these corporations work and are more accountable, they will actually invest in their companies instead of being driven by short-term profiteering and shareholders’ interests only.
"They will think for the long term, invest and grow the economy – and that’s what’s happening elsewhere."
The 105-page manifesto also proposed lavish spending on schools, hospitals and welfare benefits as well as renewing Labour promise to scrapping university fees for students and triggering a second EU referendum that could block Brexit.