Labour and Tories trade blows over plans for 'secret' tax rises

The Conservative and Labour parties on Monday ushered in the new tax year by trading blows over each other's "secret plans" to burden working families with tax rises after the May 7 general election.

Senior figures from all the main political parties were on the campaign trail, embarking on a series of attacks and counter-attacks over taxation and living standards as the campaign entered its second week.

Speaking in Leeds, Ed Balls repeated his claim that the Conservatives would raise value added tax by 2 per cent, insisting it was the only way to pay for "£10bn of unfunded tax promises".

The shadow chancellor also said the Conservatives would give another tax cut to the highest earners after George Osborne, the chancellor, refused four times on Sky News on Sunday to rule it out.

"We now know this is their secret plan," said Mr Balls. "Another big tax cut for millionaires."

The Conservatives retaliated by accusing the shadow chancellor of leaving open the option of council tax rises after Mr Balls refused to rule out a post-election increase, also on Sky News.

"Ed Balls has repeatedly refused to set out the details of Labour's secret plan for £3,028 of tax rises on every working family, but it seems that he is prepared to put up council tax," said David Gauke, Treasury financial secretary.

With living standards a key theme of this election, David Cameron sought to convince voters they were better off under a Conservative government by highlighting the rise in the personal tax allowance from Monday to £10,600.

The prime minister used a speech in Bristol to argue that 94 per cent of working households had benefited by £200 a year after the recent Budget, according to Treasury analysis.

The Conservatives also maintain Labour would implement a substantial tax rise on working households, although that claim has been questioned by the Institute for Fiscal Studies as neither "sensible" nor "helpful", as it was based on erroneous assumptions.

Mr Balls hit back, instead highlighting the IFS calculation that household incomes had fallen by £1,127 on average a year under the coalition's tax and benefit changes.

"David Cameron and George Osborne are telling people they've raised the personal tax allowance, but they won't admit that for millions this has been more than wiped out by their VAT rise and tax credit cuts," he said on Monday.

The Conservatives publish fresh accusations on Tuesday that Labour implemented big tax rises on working families when it was in power, claiming taxes on earnings rose £1,895 per year in real terms, according to latest House of Commons Library figures

"We're publishing new independent figures that show Labour's got form on tax . . . when it comes to tax rises, Ed Miliband and Ed Balls have done it all before - and they would do it all over again, if they had the chance," Mr Osborne said.

<

The tabular content relating to this article is not available to view. Apologies in advance for the inconvenience caused.

In Scotland, meanwhile, Jim Murphy, the Scottish Labour leader, told activists the opinion polls "are there to be confounded" as he launched his party's campaign in his East Renfrewshire constituency, pledging to end zero-hour contracts and introducing a mansion tax, which he claimed would deliver 1,000 extra nurses in Scotland.

Labour on Tuesday will try to reinforce its lead on the health service by unveiling a poster depicting patients queueing at a GP surgery, claiming 600 fewer surgeries across England are open in the evening and weekends compared with 2010.

The attack comes just days after Mr Cameron sought to neutralise Labour's onslaught by promising a "truly seven-day" NHS if the Conservatives are returned to power.

Jeremy Hunt, the health secretary, dismissed Labour's figures as "wrong".

© The Financial Times Limited 2015. All rights reserved.
FT and Financial Times are trademarks of the Financial Times Ltd.
Not to be redistributed, copied or modified in any way.
Euro2day.gr is solely responsible for providing this translation and the Financial Times Limited does not accept any liability for the accuracy or quality of the translation