Harman attacks Clegg on 50p
Nick Clegg today came under fire from Harriet Harman for appearing to allow the Government to cut the 50p rate of tax.
At this afternoon's Deputy Prime Minister's Questions, Ms Harman attacked Mr Clegg for "giving thousands to the very rich while at the same time cutting tax credits for people struggling to make ends meet".
She said: "Last November, when talking about the top rate of tax on income over £150,000, the Deputy Prime Minister said, and I quote, 'I do not believe that the priority is to give a tax cut to a tiny, tiny number of people who are much, much better off than anyone else'.
"If the Chancellor announces any cut in the top rate of tax, on this side of the House, we'll vote against it. Will he?"
Mr Clegg told Labour's Deputy Leader that she would need to wait until tomorrow's Budget for the details. He said: "Mr Speaker, she'll have to wait for the Chancellor, till the Chancellor announces his Budget tomorrow. But I'll tell you this: the priority, the priority for me and indeed the priority for the whole Coalition government, the priority will be to provide real help to people on middle and low incomes, who face higher prices, who've had to face the great difficulties because of the economic implosion she and her colleagues presided over, presided over in Government and whatever changes that there are to this bit of the tax system and that bit of the tax system we on this side of the House believe that the wealthy should pay more because the broadest shoulders should bear the heaviest burden."
According to Government sources, the rich will pay twice as much as they receive in tax breaks in Wednesday's Budget.
They say any reduction in the top 50p rate of income tax will be compensated for by measures on stamp duty, a general anti-avoidance rule and a "tycoon tax".
But accountants warned the Treasury could lose billions by delaying dropping the rate until 2013, as wealthy taxpayers opt to defer income until the rate comes down to 45p.
In another initiative, which has been warmly welcomed by the Taxpayers' Alliance, taxpayers will also get a breakdown of what proportion of their income tax and national insurance is spent on areas such as health, welfare and education.
This afternoon Conservative MP Jesse Norman expressed concern that voters will be turned off the Government by plans to cut the top rate of income tax in the Budget.
Mr Norman told the BBC’s World At One programme: “I do think that the possibility of cutting the top rate is a concern. I do not think people will understand that this is being done in order to raise more money… That idea, I don’t think is going to get across without an enormous amount of communication.&rdquo