Tax challenge to Tories as Ukip vows to cut 40p rate

UKIP will today pile pressure on Chancellor George Osborne to ease the tax burden on millions who have been sucked into the higher 40p rate of income tax.

The party is proposing a 35p rate on earnings between £42,000 and £55,000, arguing that many middle-class families on such i ncomes are being unfairly squeezed.

It will also float the idea of a ‘turnover tax’ – a percentage of companies’ annual turnover to be paid to the Treasury – to crack down on l arge- s cale t ax avoidance.

Ukip says the £2.5billion-a-year cost of a 35p income tax rate should also be met by cutting the foreign aid budget, ending

‘Raise income tax

starting rate’

contributions to Brussels by exiting the EU, slashing funding to Scotland and scrapping the proposed high-speed rail line HS2.

The party, led by Nigel Farage, will also back a Liberal Democrat policy to further raise the starting rate for income tax to £12,500, bringing it broadly in line with the minimum wage.

Ukip economics spokesman Patrick O’Flynn, who will propose the 35p rate at his party’s annual conference today, said: ‘ It’s incredible that a Tory chancellor after half a decade in office is going to go into an election with a 40p threshold that’s actually lower than the one he inherited from a Labour chancellor.’