Rich should pay more tax: Kinnock

The rich should pay more tax and 50p is the correct rate for the highest level of income tax, former Labour leader Neil Kinnock said.

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Lord Kinnock said it is right that rich people should pay more tax.

The rich should pay more tax and 50p is the correct rate for the highest level of income tax, former Labour leader Neil Kinnock said.

Years of austerity should be used to build a sound foundation for the future, Lord Kinnock said, not the platform for an ideology-driven shrinking of the state.

The Labour peer, who led his party to defeat in 1987 and 1992, told the BBC One Andrew Marr Show the lessons of post-war austerity showed the least well off had to be protected and insisted this was current party policy.

He said: "We can use the same attitude as was evident in the last genuine austerity government, since George Osborne wants to take us back to 1948, and that is austerity that has two characteristics.

"One, it is fair at every possible level and the broadest backs bear the heaviest burden - they are doing the opposite at this moment - and secondly that austerity is used as the basis for renewal and prosperity instead of being used as an excuse to cut the state back to levels where it is rudimentary."

Pressed on whether this would leave Labour open to the devastating "tax bombshell" claims which undermined Lord Kinnock's doomed campaigns, he said: "It depends who is required to pay the additional tax.

"What we have got is a country in which the top rate of tax on people over £150,000 per year has been cut from a 50% rate to a 45% rate. I'm not saying they can for everything but bankers' bonuses taxation should be restored to the rational system that we had, we should have a top rate of 50%, that is very clearly the Labour Party's unerring policy.

"Then we say we're going to balance the economy, balance the books - let's do it in a rational way that includes the sustaining development of the civilised parts and the essential efficient parts of life, including education, including research and development, and not destroy in this bid to apply an ideology of reducing the state, our country, to a very long period of extremely low growth."

Speaking on the same programme, the Liberal Democrat Chief Secretary to the Treasury Danny Alexander said his party had proposals for more money to be raised from the wealthy.

"Well, we had a set of proposals at our party c onference this autumn, it included a mansion tax, it also included measures on capital gains tax, to better align that with income tax, for example," he said.

"Obviously, we've done a lot in this autumn statement on tax avoidance. I think there's more we could do there, particularly from large corporations, so I think there's quite a lot more that we can do on the tax side.

"But of course, I acknowledge, there has to be further spending restraint too."