10 Nov 2009 Harriet Harman plots 'soak the rich' tax raid on middle classes

[Watchman]

Harriet Harman plots 'soak the rich' tax raid on middle classes

By Tim Shipman, Deputy Political Editor
Last updated at 8:33 AM on 10th November 2009



Harman

Squeeze: Harriet Harman plans to hit the middle class in her bid to improve social inequality

Middle-class homeowners face a new raid on their incomes under plans for council tax and capital gains tax rises being pushed by Harriet Harman.

Labour's deputy leader wants the government to bring in new 'soak the rich' measures to narrow income inequalities.

Last night the Tories accused Miss Harman of trying to curry favour with the Left and of positioning herself for a bid for the Labour Party leadership.

She has commissioned a report by Professor John Hills - drafts of which are already circulating in Whitehall - which has concluded that wealth inequality has deepened under Labour and reduced social mobility.

When the paper is published in January, Miss Harman, the minister in charge of equality, will use its findings to push her agenda to redistribute income.

She has already demanded that every government department and local council consider how to stamp out inequalities each time they draw up policies.

The Mail has learned that Miss Harman has begun privately lobbying for tougher capital gains taxes levied on main homes. She also wants Labour to widen council tax bands, so that more people are sucked into the higher bands and pay more.

The move is likely to enrage the Treasury, which is supposed to be in charge of taxation.

Chancellor Alistair Darling was a reluctant convert to the 50p tax rate for high earners.

A spokesman for Miss Harman denied that the report will come up with specific policy proposals.


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But a Westminster source said: 'She will use the report to push these ideas. Harriet is talking about capital gains and council tax. That's what she wants to do.'

Labour moderates are horrified by the way Miss Harman is dragging the party to the left. They believe that the party will suffer a disastrous general election result, partly as a result of deserting the middle class families who elected Tony Blair three times.

Former minister Tom Harris condemned the tax proposals yesterday, saying: 'Such a move would stink. There is nothing intrinsically good or moral in taxing for its own sake.'

Tory treasury spokesman David Gauke said: 'In her attempts to appeal to the Labour left and advance her own ambitions Harriet Harman is playing at being Chancellor - what does Alastair Darling think? This is yet more evidence of Labour in complete disarray at a time when we need a strong and coherent Government.'

A spokesman for the Equalities Office said: 'No plans have been made for policy decisions based on the Hills Report, which is due in the new year. Taxation is a matter for the Chancellor only.

'This is not a plan to hit the middle classes. Everyone benefits from a society that is more inclusive and that provides opportunities for all.'

Read more: http://www.dailymail.co.uk/news/article-1226357/Harman-declares-war-middle-classes-plans-higher-council-capital-gains-tax.html#ixzz0WVSWimTO



Read more: http://www.dailymail.co.uk/news/article-1226357/Harman-declares-war-middle-classes-plans-higher-council-capital-gains-tax.html#ixzz0WVRk9fK9