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However, I've seen little from Labour to suggest that their opposition to increases in corporate tax is due to a desire to counteract these narratives. It seems to me rather that the opposition to these CT rises is intended to signal to big business that a future Labour government poses no threat, after the Corbyn years in which the party was perceived to want to confront capital more directly.
I think it's partially both, but that's quite a complex narrative to sell, so I'm not surprised it's not landing. I'm a geek for this stuff and I don't quite have the hang of it yet. But that is broadly what they're briefing:
One senior party source tells me: “The approach being advocated by Ian Lavery and Richard Burgon is an unintended argument for austerity because it suggests you can fiddle with taxes and spending to pay off debt accumulated in an economic downturn. It’s the mirror of the argument George Osborne made a decade ago.
"Labour must be far more ambitious – we should be the party focused on working with business to grow the economy and tackle the long-term weaknesses of our unequal and insecure economy, which is the way Britain will balance the books,” they add. Ironically this idea of “the proceeds of growth” being the answer to the tax/spend problem is exactly what Cameron and Osborne espoused in Opposition before the financial crash.
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ReekBlefs
Dunt is right in saying that raising taxes now, if framed in a certain way, would help reinforce the narrative that 'the pandemic must be paid back' (it doesn't, in the conventional sense), that government spending is like a household budget (it isn't), and that there are constraints on government borrowing (there aren't really at the moment); all of these can be ways to justify austerity.
However, I've seen little from Labour to suggest that their opposition to increases in corporate tax is due to a desire to counteract these narratives. It seems to me rather that the opposition to these CT rises is intended to signal to big business that a future Labour government poses no threat, after the Corbyn years in which the party was perceived to want to confront capital more directly.
These arguments leave to one side the simple fact that our CT far too low and that raising it is unlikely to have a negative impact on demand—both reasons to back these changes.