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Tory tax commission calls for £21bn tax cuts

The Tory’s Tax Reform Commission has published its report recommending a £21bn cut in taxes including scrapping IHT on primary residences and slashing corporation tax levels.
Head of the commission Lord Forsyth told an audience at KPMG’s headquarters this morning that the proposals are realistic and set a direction of travel leading to a ‘simpler, lower, flatter, fairer and more stable tax system’.
Responding to the commission George Osborne said he hoped the menu of proposals start a major political debate in this country about making taxes simple, fair and competitive.
Osborne emphasised the Tory’s focus on rebalancing the current tax system- on a neutral basis- to cut taxes hitting families while increasing green taxes, although acknowledged the worry of such taxes hitting the poorest hardest.
Osborne said there was a strong case for a major simplification of business taxes that would then pay for a ‘significant’ reduction in business tax rates.
He said more work would be done to assess the potential benefit to Britain’s financial services and pension funds in reducing or abolishing stamp duty on shares.
Osborne said: “I believe lower and simpler taxes encourage aspiration and opportunity, and help people take more responsibility for their own lives. That is why I want to share the proceeds of growth between spending on public services and lower taxes.”
The LibDems attacked the Tory’s proposals as “utterly irresponsible”.
LibDem Shadow Chancellor Vince Cable says: “The Conservative approach to tax is totally confused. A few months ago they were advocating ‘flat taxes’ and now they have started talking about cuts in stamp duty on shares and in business taxes.
However, at their conference they talked about financial responsibility and were making it clear that there would be no commitment to specific or overall tax cuts under a Conservative government. Which is it?
The Government has also tried to woo the industry this week with the first meeting of its High-Level City Group discussing proposals to maintain and enhance the City’s competitiveness.
Proposals included examining whether the regulatory system could be lightened for insurance services with low consumer detriment or systemic risk.
It also discussed ways of boosting professional financial skills in London, conduct research into the financial skills gaps and examine proposals for a centre of regulatory expertise to provide teaching and research.
Economic Secretary to the Treasury Ed Balls says: “I am convinced there is a common understanding and a unity of purpose behind the agenda of making London and the UK financial sector the world leader.”


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