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Lib Dems in taxation cut pledge Lib Dems in taxation cut pledge
(about 5 hours later)
Liberal Democrat leader Nick Clegg is to give more details of his promise to cut the overall burden of tax. Lib Dem leader Nick Clegg says he wants "tax cuts for those who need it most" as he prepares to give details of his pledge to cut the overall tax burden.
In a marked policy departure, he will also say he wants to reduce government spending and decrease taxes for low and middle-income earners. He said his party was looking to make £20bn savings in government spending and tax the wealthy more.
The Liberal Democrats have long been identified with rises as opposed to cuts in tax. The party has been associated with tax rises - such as a pledge to put 1p on the basic tax rate to fund education.
Key past pledges have included an extra penny on income tax towards education, and a 50p tax rate for top earners. But Mr Clegg told the BBC: "It is impeccably liberal to say we should have a fairer tax system."
Possible opposition
But Mr Clegg said times have changed, and with the squeeze on people's household budgets the government should have to tighten its belt too.
He wants his party to identify £20bn of savings which would be used to cut taxes for lower and average earners, and to bring down the overall level of tax.He wants his party to identify £20bn of savings which would be used to cut taxes for lower and average earners, and to bring down the overall level of tax.
BBC News political correspondent Reeta Chakrabarti says it is a bold attempt by Mr Clegg to distinguish the Lib Dems from the other main parties, which are both committed to the same spending levels. 'Tighten belts'
But he is unable as yet to say where the savings will be made and he could meet opposition within his own party for the message it sends out, she added. Mr Clegg wants to close "loopholes" in capital gains tax and pension tax relief which he says favours the better off, and raise green taxes to punish "polluters".
He told BBC Radio 4's Today programme the tax system had to become "much fairer" and the government had to "tighten its belt" - for example by slashing the number of MPs by one third, some defence programmes and even some Whitehall departments.
We are quite unapologetic about saying that people who have got a lot of money will pay more Nick Clegg
"I don't accept the assumption from Gordon Brown and David Cameron, that the level of public spending at the moment is cast in stone forever."
Shadow chancellor George Osborne has said Mr Clegg can afford to make such pledges because his party - the third largest at Westminster - is not expected to win power.
But Mr Clegg told the BBC: "He would say that wouldn't he? We have always been very assiduous at saying if we are going to offer tax cuts for people on low and middle incomes we are going to be quite explicit about where it comes from."
"We are quite unapologetic about saying that people who have got a lot of money will pay more, people who pollute will pay more through our green taxes and that some government expenditure, waste at the centre.. that will also be where we get the money from."
Safeguard finances
Mr Clegg said he was taking forward the Lib Dem "tradition" of making the tax system fairer and tax cuts must come from the "bottom up" - which he said differentiated his party from the Conservatives.
Asked about the previous 1p pledge - abandoned in 2002 - he said the party had identified a lack of government spending on public services ten years ago which had since doubled.
Of a previous pledge to introduce a 50p tax rate for top earners, he told BBC Radio 4's Today programme "we did our sums, as did others, it worked out it didn't raise as much as we initially thought it had - we felt it was better to look at the tax system as a whole."
On Tuesday, Conservative leader David Cameron did not rule out the possibility of tax rises if his party wins power. He told the BBC he hoped it would not happen but government had to do "what is right to safeguard the public finances".