Lib Dems to rethink tax policies

Liberal Democrat shadow chancellor Vince Cable has signalled a re-think on his party’s tax policies, following a call by leader Charles Kennedy for a review of policy-making processes.

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Cable said the Lib Dems would retain a commitment to higher taxation for the wealthy, but needed to reconsider its presentation. In particular, he said they should look at the combined effect of progressive national taxation and plans for a local income tax to replace Council Tax.

This follows Kennedy’s own confusion early in the general election campaign – put down to tiredness after just becoming a father – over how the two taxes would interact.

Cable said the party would have to debate how to move to a more progressive tax regime while retaining plausibility.

His comments follow Kennedy’s announcement – in a speech welcoming his new MPs to Westminster – of a tax commission to look at ways of making the tax system fairer and simpler.

Kennedy also called for a change in the rules concerning policy-making to prevent controversial proposals becoming party policy after debates by a few delegates at poorly attended annual conference sessions.

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