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Last Updated: Tuesday, 20 September 2005, 12:07 GMT 13:07 UK
Lib Dems call for 'fairer' taxes
Vincent Cable
Dr Cable said 'credibility' rested on economic policy

The Liberal Democrats have been urged to back a system of "fairer taxes, not higher taxes".

The party is re-examining its tax policy, amid speculation a proposed 50% rate for people earning more than 100,000 a year will be dropped.

Treasury spokesman Vince Cable said: "Many voters still...associate us with high taxes and big spending."

The party's "credibility hinges on our changing that perception", he told the party's annual conference in Blackpool.

'Social justice'

Dr Cable suggested taxation could be used to improve the environment, with higher charges for polluters.

People on low incomes should be exempt from paying income tax, for the sake of "social justice", he added.

Dr Cable said: "I believe our central message should be 'fairer taxes; not higher taxes.

"There are many people who pay too much tax. It is fundamentally wrong that people - be they workers or pensioners - who are bring home less than the equivalent minimum wage should be paying income tax, on top of council tax and indirect taxes."

The Liberal Democrats have appointed a commission to look at tax.

'Stoats and weasels'

Last week, Dr Cable told the BBC News website that the proposed 50% tax pledge was not a "sacred cow".

He said he would look at the system of "flat tax" used in some eastern European countries, under which all income tax payers are charged the same rate.

The party's policy of a local income tax, to replace council tax, will also be discussed.

In his speech, Dr Cable accused Gordon Brown of over-centralising and creating an overly complex tax system.

He said: "The chancellor set out as a Good Samaritan but has ended up as Scrooge."

He added: "Those of you who, like me, grew up with Wind in the Willows rather than Harry Potter will remember a character called Toad of Toad Hall.

"Toad, like the chancellor, was shamelessly boastful, egged on by an admiring fan club of stoats and weasels."

The debate on taxation comes after party leader Charles Kennedy indicated some voters might have been put off by its pledges in the last election.


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