Eurosceptics find a friend at No 11

CHANCELLOR Gordon Brown's increasingly belligerent attitude towards the European Commission in general and its tax harmonisation plans in particular is upsetting more than the Euro-federalist bureaucrats in Brussels – his next door neighbour in Downing Street isn't be too pleased either.

The Chancellor is digging his heals against some of the wilder aspects of supranationalism emanating from the Continent, and he has received support from Euro MPs, who have rejected Commission plans to charge full-rate VAT on children's clothes, shoes, and postal services, including stamps.

The MEPs have also voted down a plan to outlaw low VAT rates on repair costs for historic buildings, which would have had a massive impact on East Anglia's rural communities trying to raise cash to renovate village churches.

Mr Brown had already made clear he would block attempts to apply any VAT – let alone the full 17.5% rate – on children's clothes in Britain and the European Parliament vote in Brussels will add weight to Mr Brown's arguments against tax harmonisation when he meet Europe's finance ministers this month.

He's been backed by Tory and Plaid Cymru MEPs. Theresa Villiers (Conservative, London), said: "Hard-pressed young families would be hit by new costs if the European Commission's plan to impose VAT on children's clothes is accepted. We have now secured cross-party support in the European Parliament to keep children's clothes free of VAT."

Ms Villiers tabled an amendment adding repairs to historic churches and all buildings maintained by charities, to the list of those items allowed a reduced rate of 5%. "This is a vital victory on a reduced rate for repairs to historic churches. The cost of repairs can be huge and paying full VAT puts an added burden on churches and their congregations.

"Without a reduced rate, many listed churches might have to be demolished which would be a tragic cultural loss to our country."'

Jill Evans (Plaid Cymru, Wales) welcomed the rejection of "unfair" tax hikes which would put extra strain on household finances, particularly low income families and Bashir Khanbhai (Conservative, East of England) hailed as "an important victory" the European Parliament's Economic and Monetary Affairs Committee's rejection of European Commission's proposals to put VAT on postage stamps.

"Putting VAT on stamps would have been an unwanted extra cost at Christmas," says Mr Khanbhai. "With 60 tax rises in the UK from Gordon Brown, the thing we need is more expense imposed by the European Commission."

LIBERAL Democrat leader Charles Kennedy has finally snapped. He's allowed Tony Blair to "misinterpret" his party's tax and spend plans each week in the Commons since the party conference season, and now he wants an apology.

For the record, says Mr Kennedy, his party would not increase direct taxes "for anyone with an income under £100,000. The current top rates of tax would not change. They would remain at 40%."

The Prime Minister has taunted constantly the Lib Dems for saying all its public spending proposals would be paid by raising tax to 50p in the pound for top earners. "Our proposals would only cut in on marginal incomes over £100,000," says Mr Kennedy. "Anyone who has income over and above that figure would be taxed at 50% or 50p in the pound, on that excess income and no other.

"According to Government figures this would raise £4.7 billion which the

Liberal Democrats would dedicate to two key policies – the abolition of

university tuition fees at a cost of up to £2 billion, and the provision of

free long-term personal care to the elderly, costing £1 billion. The

balance of funding leftover would be directed to local government. Those

are our sole commitments for this money and they will not change before the

next election."

So now we know – just why it it's taken the Lib Dems so long to react remains a mystery.