Brown and Blair at odds on top rate tax

Shadow Chancellor Gordon Brown is keeping his top rate tax options open despite Labour party leader Tony Blair’s claim to have no plans to ‘soak the rich’.

Brown rushed out a comment making it clear he would commit himself only after Chancellor Kenneth Clarke opens his books on the state of the nation’s finances in his November Budget.

Continuing reports suggest that close Brown advisers see the need for increased revenue – and favour a 50% top rate of tax hitting incomes above # 40,000.

But Blair made it clear: ‘There are no proposals in our programme which require the raising of taxes.’

Blair spoke out after a further policy switch over Labour’s plans for a Scottish parliament with marginal taxation powers.

His proposal for a referendum with two questions on home rule and the power to raise or lower income tax by up to 3p in the pound ran into trouble at a meeting of the Scottish Labour Party executive last weekend.

They agreed a compromise package which proposed a second referendum after the election of a parliament in Edinburgh to approve plans to use any tax raising powers.