Labour and Tories rush to deny secret tax plans

Guy Bentley
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Both the Labour and Conservative parties have rushed to deny claims they plan to radically alter the tax system in the wake of two separate recordings emerging of senior figures in both parties voicing their views on the subject.

Obtained by Sky News, a recording of Labour's Andy Burnham at the Fabian Society's summer conference suggested that the best way to fund a national care service would be to levy a 15 per cent "death tax" on estates.

The shadow health secretary told the conference "I put that forward before the last election to support a national care service...but there is a debate to be had on whether that is acceptable to the public."

The Labour party quickly distanced itself from the remarks, saying "this is not Labour policy. We have made clear we want to improve social care and we are consulting on how that is best done."

In a separate recording, obtained by the Daily Mirror, Tory minister for government policy Oliver Letwin appeared to moot the idea that a flat rate of tax could be examined once the public finances were not in such a parlous state.

Answering a question at an event staged by the think-tank Politeia, Letwin warned "It’s enormously complicated and a risk to business if we move to a flat tax regime in the hope that we get enough extra revenue to make up for the revenue you will certainly lose."

However, he added "there may come a time when the situation is different and that discussion will no doubt open up at that point."

A Conservative party spokesman dismissed any claims that a flat tax would be part of the Conservative manifesto, saying "there will be no flat tax. We oppose it. Full stop."

George Osborne praised the flat tax system back in 2005 when he was shadow chancellor, declaring that a flat tax was "a very exciting idea, that started in central and eastern Europe, but now is being looked at by other countries like Greece, and there is some speculation that Germany is looking at it."

However, he added the caveat "we may not be able to introduce a pure flat tax, but we may be able to move towards simpler and flatter taxes."

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