Fairer taxation is the key in Lib Dems' Alternative Budget
March 1, 2005 5:47 PM
Charles Kennedy MP wants fairer taxation and better public services
Lib Dem leader Charles Kennedy MP and Shadow Chancellor Dr Vince Cable MP have launched the party's alternative budget, stressing the need for fairer taxation and improvements in public services.
Mr Kennedy said : "When it comes to electoral success economic credibility is crucial. Which is why the Conservatives are still unelectable. I am determined that, at the General Election, we will maintain the reputation for economic integrity that we have built up over this Parliament. We have a reputation for being straight forward on tax. That will not change."
Dr Cable went on to explain, ""We have identified over five billion pounds a year where low priority spending can be reallocated to our priority areas such as pensions, policing, health and education."
"Our tax system currently reinforces rather than mitigates inequality. The poorest 20% pay a higher percentage of their income in tax than the top 20%. People don't want to pay more tax but they want it distributed more fairly."
The main points of the Liberal Democrat Alternative Budget are given below.
On taxation :
1. Abolishing the unfair Council Tax and replacing it with a fair system of Local Income Tax based on earnings and not the value of property. The average family would be £450 per year better off, but pensioners would particularly benefit.
2. Introducing a new 50% rate of Income Tax on incomes over £100,000 per year. The richest in society can afford to pay a little more towards supporting the less wealthy; this would be used to abolish student tuition fees and provide free long-term care for pensioners.
3. Raising the Stamp Duty threshold from £60,000 to £150,000. This would benefit around 400,000 people each year, predominantly first-time buyers and young families.
4. Changes to business taxation to ensure that polluters pay for their environmental impact whilst rewarding environmentally-friendly companies - the overall 'tax take' from business would remain the same.
On public services :
1. Increasing the basic state pension by £100 per month for the over 75s to address pensioner poverty and lift a million pensioners out of degrading means-testing.
2. Raising maternity pay from £100 per week to £170 per week for the first six months, giving mothers more choice about when they return to work.
3. Putting an extra 10,000 police officers on the street to prevent crime and terrorism.
4. Reducing primary school class sizes to 20 for 5 to 7 year olds, giving children the best possible start in life.
5. Abolishing student tuition fees to give everyone the chance to go to university if they have the ability. This is already the case in Scotland thanks to the Lib Dems.
6. Abolishing long-term care charges for pensioners. This is already the case in Scotland thanks to the Lib Dems.
On waste :
1. Abolishing the Child Trust Fund, ID card scheme, final stages of the Eurofighter programme, industrial and agricultural subsidies and aspects of the Department of Trade and Industry will enable £5 billion to be redirected to high-priority public services.
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