Lib Dems back switch to green taxes

THE era of a switch in taxation from wage earners to polluters has been heralded by the Liberal Democrats, who believe the introduction of green taxes will have mass voter appeal.

By Graham Dines

THE era of a switch in taxation from wage earners to polluters has been heralded by the Liberal Democrats, who believe the introduction of green taxes will have mass voter appeal.

The policy was agreed overwhelmingly at the annual party conference in Brighton yesterday, giving Sir Menzies Campbell his first major victory since becoming leader last March.

It means the party has ditched one of its key pledges of the last General Election - that a new 50p top rate of income tax be introduced on all incomes over £150,000.

Sir Menzies welcomed the vote, saying: “We are going into the next election with bold and credible tax policies. They demonstrate our commitment to tackling inequality and environmental damage whilst maintaining financial discipline.”

Treasury spokesman Vince Cable added: “We welcome conference's endorsement of these radical tax policies, which will see two million low paid workers taken out of income tax altogether.

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“They put us on a strong footing as we move towards the next election. Green taxes will produce the behavioural changes needed to safeguard our environment without increasing the overall tax burden.”

Mr Cable said that people had to accept “policies that hurt” if there were to prove themselves serious about tackling climate change.

“We have now got a very good radical tax package, tax cutting for millions of people, a great commitment to a green switching tax, taxing the very wealthy. I think there is a recognition that we had to move on from high taxes.

“I think the attraction of being able to cut taxes for millions of people on middle and low incomes and being able to finance it in a responsible way helped members to decide.”

Under the green tax switch proposals, a Lib Dem government would slap a £2,000 road tax bill on the most polluting new cars, fuel duty would be raised in line with inflation and flights, not passengers, would be taxed.

The £8 billion raised would help pay to stop more of the lowest paid people paying income tax at all as well as cutting the bills of middle earners.

Some relief on capital gains tax and pension contributions would also be scrapped to raise more revenue in a package claimed to financially benefit all but the top 10% of wage earners.

Opponents, including rebel MP Dr Evan Harris, urged party members not to abandon the 50p top rate on salaries over £150,000. He claimed it had proved very popular on the doorsteps and was far easier to explain than the new measures, they argued.

graham.dines@eadt.co.uk

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