TaxPersonal TaxBrown under fire over CBI tax credit claim

Brown under fire over CBI tax credit claim

Treasury faces backlash as business denies pushing for tax credit scrapping

Senior business figures have accused the Treasury of acting disingenuously
and ‘creating a complete mess’ as a result of its claims that the CBI had asked
chancellor
Gordon Brown
to scrap tax credits on share dividends.

Economic secretary Ed Balls initially made the claims after documents
obtained by The
Times
showed that Brown had been warned that scrapping the tax
credits would have dire consequences for the pensions industry and workers.

Balls, however, was forced to clarify his comments after a severe backlash
from the
CBI
.

In a statement issued yesterday, Balls said senior CBI members had spoken to
the Treasury about the tax credit issue in 1996, but added that the decision
made in the 1997 Budget were not based ‘on external representations’.

Balls also did not repeat his earlier claims that the CBI came back to the
Treasury after the Budget and said Brown had not gone far enough.

One business leader told the FT: ‘Frankly, to represent that as
being the CBI point of view is disingenuous. It’s so stupid of them. They put
people in a complete mess.’

Further reading:

Brown ignored tax credit pension warnings

CBI objects to scrapping of pension tax credits

Budget07: Pensioners’ income tax threshold increased

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