UK's Cameron vows to ban tax rises if re-elected

29th April 2015, Comments 0 comments

British Prime Minister David Cameron on Wednesday promised to ban major tax increases for the next five years if his party wins a knife-edge election next week.

Cameron, who is fighting for political survival in the May 7 poll, is promising to pass a law introducing a "tax lock" to prevent increases in income tax, value-added tax or national insurance contributions to state benefits.

His centre-right Conservatives, in power since 2010 as part of a coalition government and at virtual level pegging with the opposition Labour party in opinion polls, has put the economy at the forefront of its campaign.

"As this economy recovers, I want you to be able to keep more of the money to spend as you choose," he told factory workers during a campaign speech in Birmingham, central England.

"That is the choice -- take home pay going up with the Conservatives or going down with Labour."

Experts say the taxes covered by the pledge are the three biggest earners, providing more than two-thirds of all taxation revenue.

Labour's finance spokesman Ed Balls criticised the move at a time when, he said, the British economy was "not strong and robust".

Official data released Tuesday indicated that Britain's economy grew much slower than expected in the first quarter of this year. Gross domestic product (GDP) rose 0.3 percent compared to 0.6 percent in the last quarter of 2014.

The country emerged from a double-dip recession in 2012 and still has a budget deficit of some £90 billion (124 billion euros, $130 billion).

Paul Johnson, director of the respected Institute for Fiscal Studies research organisation, said the Conservatives' goal of eliminating the deficit altogether within three years was "very tough".

"That implies some really, really, really big spending cuts," he told AFP. "Now they're clearly making it much harder to increase taxes, so that really does imply that most of this will come from reduced spending."

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© 2015 AFP

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