Lib Dems call for 4p tax cut
Updated on 10 November 2008
Liberal Democrats have called for income tax to be slashed by up to 4p in the pound to help stimulate the economy.
Vince Cable, the party's deputy leader, said there must be tax cuts for those on low and middle incomes.
With the country facing a sharp recession, he said they should be paid for by "people who are relatively wealthy".
Opening a Liberal-Democrat led debate on the economic crisis, Mr Cable said: "We argue this primarily on grounds of fairness.
"It happens to be appropriate to the context in which we operate because clearly people on low incomes have a higher propensity to spend..."
Income tax should be cut either by raising thresholds or cutting the basic rate by the equivalent of 4p in the pound - saving £1,000 for a £30,000 taxpayer.
It would be funded by tackling tax avoidance, closing loopholes and being tougher on tax havens.
His comments came as the Prime Minister raised expectations of tax cuts by saying he was looking "at everything" that could be done to help people through the downturn.
They also came just a day before the Tories are due to outline their plans for tax cuts to help people stay in work.
In the Commons, Mr Cable accused both the Government and the Conservatives of being "desperately anxious" to run onto the ground already "staked out" by his party on tax cuts.
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