Page last updated at 11:53 GMT, Wednesday, 26 May 2010 12:53 UK

Redwood warns against Capital Gains Tax increases

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The senior Conservative backbencher John Redwood has written to the Treasury with a warning that a large rise in Capital Gains Tax could damage the economy.

The former minister spoke out amid suggestions the current rate of 18% on windfalls could be increased to match income tax rates in the forthcoming emergency budget.

In his letter, Mr Redwood proposed a system where less CGT is paid the longer an asset is held.

He told Martha Kearney on Radio 4's The World At One more about his proposals.

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