Ed Davey pledges £17bn tax cut funded by rejoining the EU single market as Lib Dems battle Reform threat

From the Newshound archive · first published 22 September 2026 · last updated 23 September 2026.

Sir Ed Davey brought the Liberal Democrat conference in Brighton to a close with a pledge to increase the tax-free personal allowance to £15,000 and push the 40p income tax threshold up to £56,000 — a £17bn package he argues would be covered by the economic growth that re-entry into the EU single market and customs union would generate. Davey argued his plan is fundamentally different from Reform UK's matching personal allowance commitment because Farage's proposal is "paid for through cruelty" — namely £22bn in cuts to support for disabled people. The Institute for Fiscal Studies cautioned that the package would cost "much more" than the £17bn figure, raising serious questions about the numbers.

Davey invoked Oswald Mosley and the National Front as he repeatedly targeted Nigel Farage, telling his party this is "the fight of our lives."

The Lib Dems claim a single market deal could be struck within a year of taking power, though the OBR and economic experts warn EU negotiations rarely run to schedule.

The party is averaging just 10-11 per cent in the polls and is sometimes placed fifth, with the New Statesman reporting open internal questions about Davey's relevance.