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| Labour would bring back 50p tax rate | Labour would bring back 50p tax rate |
| (35 minutes later) | |
| Labour would reintroduce the 50p top rate of income tax for those earning over £150,000, if it returns to power, the shadow chancellor has said. | Labour would reintroduce the 50p top rate of income tax for those earning over £150,000, if it returns to power, the shadow chancellor has said. |
| Ed Balls said a government analysis which showed it did not raise much was skewed by ministers' assumptions. | Ed Balls said a government analysis which showed it did not raise much was skewed by ministers' assumptions. |
| The last Labour government raised the upper tax band from 40% to 50% in 2010 in response to the recession, but the coalition cut it to 45% last April. | The last Labour government raised the upper tax band from 40% to 50% in 2010 in response to the recession, but the coalition cut it to 45% last April. |
| The Tories warned the proposal would put "the economic recovery at risk". | The Tories warned the proposal would put "the economic recovery at risk". |
| Mr Balls said latest figures from HM Revenue and Customs showed those earning over £150,000 paid "almost £10bn more in tax" in the three years when the 50p top rate of tax was in place than when it was cut in 2012. | Mr Balls said latest figures from HM Revenue and Customs showed those earning over £150,000 paid "almost £10bn more in tax" in the three years when the 50p top rate of tax was in place than when it was cut in 2012. |
| The Government said its decision to cut the rate to 45p reduced Treasury income by £100m - a figure backed by the Office for Budget Responsibility. | |
| Speaking to the Fabian Society in central London, Mr Balls said: "When the deficit is still high, it cannot be right for David Cameron and George Osborne to have chosen to give the richest people in the country a huge tax cut." | |
| He went on to say the next Labour government wanted to finish the job of getting the deficit down by "reversing this unfair tax cut for the richest 1% of people in the country". | He went on to say the next Labour government wanted to finish the job of getting the deficit down by "reversing this unfair tax cut for the richest 1% of people in the country". |
| Other Labour pledges Mr Balls highlighted in his speech included: | Other Labour pledges Mr Balls highlighted in his speech included: |
| Mr Balls also announced a Labour government would balance the books and deliver a budget surplus as well as passing a law to ensure it adheres to "tough" and binding fiscal rules, he said. | Mr Balls also announced a Labour government would balance the books and deliver a budget surplus as well as passing a law to ensure it adheres to "tough" and binding fiscal rules, he said. |
| This would mean eliminating the deficit and cutting debt as a share of GDP between 2015 and 2020. | This would mean eliminating the deficit and cutting debt as a share of GDP between 2015 and 2020. |
| Labour's commitment does not include borrowing extra money for long-term investments, such as the high speed rail link. | Labour's commitment does not include borrowing extra money for long-term investments, such as the high speed rail link. |
| The Conservatives have dismissed the proposal. | The Conservatives have dismissed the proposal. |
| Sajid Javid, Financial Secretary to the Treasury, said: "Ed Balls is proposing more spending, more borrowing and more taxes. | Sajid Javid, Financial Secretary to the Treasury, said: "Ed Balls is proposing more spending, more borrowing and more taxes. |
| "Labour would put the recovery at risk, drive away investment and put our economic security at risk. That would put the financial security of hardworking people and their families at risk." | "Labour would put the recovery at risk, drive away investment and put our economic security at risk. That would put the financial security of hardworking people and their families at risk." |
| Earlier, Conservative Treasury minister David Gauke said he stood by the figures produced in HMRC analysis which showed the 50p rate would "raise little, if anything". | Earlier, Conservative Treasury minister David Gauke said he stood by the figures produced in HMRC analysis which showed the 50p rate would "raise little, if anything". |
| He added: "If Labour want to deliver a reduced deficit, given their opposition to any of the spending cuts we're putting in place, then I'm afraid they're just going to have to put up taxes on everyone - not just the top earners." | He added: "If Labour want to deliver a reduced deficit, given their opposition to any of the spending cuts we're putting in place, then I'm afraid they're just going to have to put up taxes on everyone - not just the top earners." |
| Chancellor George Osborne has set the Conservatives the slightly more ambitious target of an absolute budget surplus by 2020, which means generating more in revenues, including tax yields, than the entire expenditure. | Chancellor George Osborne has set the Conservatives the slightly more ambitious target of an absolute budget surplus by 2020, which means generating more in revenues, including tax yields, than the entire expenditure. |
| The last time the government ran an absolute budget surplus was in 2001. | The last time the government ran an absolute budget surplus was in 2001. |
| 'Fairer taxation system' | 'Fairer taxation system' |
| The potential return to the 50p top rate was welcomed by unions. | The potential return to the 50p top rate was welcomed by unions. |
| Labour has previously pledged to reintroduce the 10p lower tax band, funded by a "mansion tax" on £2m properties. | Labour has previously pledged to reintroduce the 10p lower tax band, funded by a "mansion tax" on £2m properties. |
| Unite called it a sign that a future Labour government "understands the need for a fairer taxation system". | Unite called it a sign that a future Labour government "understands the need for a fairer taxation system". |
| A spokesman said: "This is a beginning. Voters will know now Labour is emerging as a positive choice for this country. | A spokesman said: "This is a beginning. Voters will know now Labour is emerging as a positive choice for this country. |
| "Contrast this move with the complacency of the government, which instead of finding ways to get money into people's pockets, insists to cash-strapped workers everything is rosy." | "Contrast this move with the complacency of the government, which instead of finding ways to get money into people's pockets, insists to cash-strapped workers everything is rosy." |
| But Katja Hall, chief policy director of the CBI, warned that a 50p tax rate would put talented people off coming to the UK to invest and create jobs. | But Katja Hall, chief policy director of the CBI, warned that a 50p tax rate would put talented people off coming to the UK to invest and create jobs. |
| Simon Walker, director general of the Institute of Directors, said Labour needed to drop its practice of "knee-jerk reversion to the old Socialist nostrums that so damaged Britain's economy in the past". | Simon Walker, director general of the Institute of Directors, said Labour needed to drop its practice of "knee-jerk reversion to the old Socialist nostrums that so damaged Britain's economy in the past". |
| "It was, and remains, an envy-driven political gesture designed solely to drive a wedge between voters," he added. | "It was, and remains, an envy-driven political gesture designed solely to drive a wedge between voters," he added. |