Labour's Dilemma: Rejoining the EU Customs Union vs. Tax Increases

Recent polling indicates a significant preference among Labour voters for rejoining the European Union’s customs union over raising taxes. A Savanta poll revealed that 67% of Labour supporters would favor this option, while only 18% would prefer tax increases. This sentiment is echoed by over half (52%) of UK adults surveyed, highlighting a growing discontent with the government's current economic strategies.

The Independent

The economic fallout from Brexit has become a focal point for Labour leaders. Deputy Prime Minister David Lammy has suggested that rejoining the customs union could enhance economic growth, citing evidence from other countries that have benefited from similar arrangements. He emphasized that Brexit has "badly damaged" the UK economy, with the Office for Budget Responsibility (OBR) forecasting a 4% reduction in long-term productivity due to the departure from the EU.

The IndependentiNewsThe Independent

Labour's leadership is facing mounting pressure to reconsider its stance on Brexit. Baroness Shafik, Sir Keir Starmer’s chief economic adviser, reportedly advocated for rejoining the customs union prior to the recent Budget, arguing it would reduce costs for businesses and boost exports. Despite this, the official party line remains against rejoining the customs union or the single market, as stated by Lammy and reiterated by other party officials.

The Independent

In response to the growing calls for a shift in policy, a Downing Street spokesperson reiterated the government's commitment to its "clear red lines" regarding the single market and customs union. They emphasized the need for a credible economic vision that positions the UK as an open trading economy. Lammy's comments, while highlighting the potential benefits of a customs union, were framed as not being current policy, indicating a divide between public sentiment and official Labour policy.

iNews

Critics within the Labour Party, such as Darren Jones, have challenged Lammy's public statements, asserting that any policy changes should be announced in Parliament rather than through media appearances. This internal conflict underscores the complexities facing Labour as it navigates its position on Brexit amidst economic challenges and public opinion.

The Independent

As Labour grapples with its Brexit strategy, the party's leadership must weigh the implications of public sentiment against established policy. The upcoming parliamentary vote on a Liberal Democrat bill to negotiate a customs union with the EU will serve as a litmus test for Labour's direction. With economic pressures mounting, the party faces a critical juncture in determining its future relationship with the EU and its approach to taxation.

The Independent

• “It’s self-evident that leaving the European Union badly damaged our economy, took us out of an important market place and created serious friction,” — David Lammy, Deputy Prime Minister

iNews

• “Mr Pinkerton told The Independent: “A closer trade deal with the EU is a no-brainer.” — Al Pinkerton, Liberal Democrat Europe spokesperson

The Independent