Labour’s “retirement tax” is set to hit millions of state pensioners within two years, shock new analysis shows.

Sir Keir Starmer’s party has said it will keep the tax free personal allowance frozen at £12,570 until 2028.

But the state pension is on track to approach this amount by April 2026 under the triple lock, meaning millions of retirees are at risk of being dragged into paying income tax.

Shadow work and pensions secretary Mel Stride told the Daily Express: “Keir Starmer wants you to believe that Labour has changed, but hiking taxes is in their DNA.

“Labour’s refusal to increase income tax thresholds despite our repeated warnings means pensioners will be paying the price, forcing elderly people into paying incoming tax for the first time in history.

“Everyone deserves peace of mind and security in retirement, so if Labour has any respect for our pensioners they should put a stop to their retirement tax.”

Former pensions minister Sir Steve Webb called for a joined-up approach to pensions and income tax.

Sir Steve, partner at pension consultants LCP, said: “There are already well over two million pensioners whose state pension on its own brings them into the income tax net.

“But this number will jump in a few years’ time if the standard rate of the new state pension exceeds the income tax personal allowance.

“Policy on pensions and policy on income tax needs to be joined up to avoid a situation where millions of pensioners could receive letters demanding relatively small amounts of tax, but creating a lot of hassle and the risk of scammers taking advantage of the whole process.

“We urgently need a long-term strategy for pensions and taxation rather than a year-by-year lottery.”

Under the triple lock, the state pension usually rises each April by whichever is highest out of inflation, average earnings or 2.5%.

Average wage growth was 5.7% between March and May, according to Office of National Statistics figures released today.

With inflation now down to 2%, earnings growth is expected to be the highest of the three figures this year.

A 5.7% increase would bump the state pension up to £12,158 from April 2025.

The Bank of England forecasts 2.75% average wage growth next year, which would see the state pension rise to £12,492 by April 2026 – just £78 under the personal allowance.

The Conservatives warned during the election campaign that Labour would hit pensioners with a “retirement tax” if the party took power.

Labour failed to match the Tories’ “triple lock plus” commitment, which would have protected any retiree relying solely on their state pension from paying income tax.

An HM Treasury spokesperson said: “Older people should be able to live with the dignity and respect they deserve, and the State Pension is the foundation for this.

“We are committed to the Triple Lock, and pensioners whose sole income is the new state pension and who have not deferred or receive protected payments do not pay any income tax.”