Keir Starmer defends persevering with controversial Tory ‘tax haven’ scheme within the Budget

Keir Starmer will continue the Tory freeport scheme with five new locations to be confirmed in the Budget.

The Prime Minister defended his decision to push on with the scheme, which critics say turns parts of the UK into tax havens by allowing firms to dodge import taxes. Previous Tory PMs touted freeports as a benefit of Brexit, allowing the Government more flexibility to give tax breaks to firms.

Rishi Sunak announced a raft of locations in 2021, with the first one set up in Teesside later that year. At the time, Mr Starmer criticised the Government for putting “blind faith” in freeports instead of hammering out a better Brexit deal.

But the PM has ditched his opposition to the idea, saying he will deliver for working people “with no ideological lens”. Chancellor Rachel Reeves will name five locations in next week’s Budget, as well as a new investment zone in the East Midlands.

Speaking on a visit to a major Commonwealth summit, Mr Starmer said: “I have always said I will look at whatever will deliver for working people, with no ideological lens. “So yes freeports were a scheme we inherited, but when combined with Labour ’s laser focus on growth generated from the ground up, we will maximise their potential.

“My government is rewiring how and where growth is generated to secure investment and create good jobs for working people.” Firms don’t have to pay tariffs on goods imported into freeport sites, and only pay on products leaving for elsewhere in the UK.