Attacks from inside party force Clegg to retreat on tycoon tax

Deputy PM waters down plans to make the rich pay their share after senior figures' angry reaction

Nick Clegg appeared to back away from his eye-catching proposal for a "tycoon tax" on the very wealthy yesterday after the idea sparked a row with senior Liberal Democrat colleagues.

Mr Clegg used an interview before his party's spring conference in Gateshead to suggest that rich Britons should pay a minimum rate of tax of more than 20 per cent on their total annual income. But the move was immediately attacked by the party's former Treasury spokesman, Lord Oakeshott, who called Mr Clegg's plan a "superficially attractive measure that falls apart under scrutiny".

Other senior Liberal Democrats, including the Business Secretary, Vince Cable, also privately criticised the proposal, arguing that it diluted the party's central policy of a mansion tax on multi-million-pound properties.

Mr Clegg's aides had tried to prevail on Mr Cable to support the plan, which it is believed he knew nothing about in advance. However, all he would say was that the idea was "an interesting one" but that he had "not seen the detail of the proposals".

In his keynote speech to delegates, Mr Clegg made no mention of a specific "tycoon tax". Instead he talked about "calling time on the tycoon tax dodgers".

He said: "We will make sure everyone pays a fair level of tax. Too often, rather than paying their dues, the wealthy pay their accountants to get them out of it. Avoiding tax, minimising the amount they have to contribute – that's the name of their game.

"The sight of the wealthiest scheming to keep their tax bill down to the bare minimum is frankly disgraceful."

Afterwards, Mr Clegg's aides suggested that the tycoon tax plan was just one of a "smorgasbord of ideas" which the Liberal Democrats were bringing to the Budget negotiations with the Tories. Others included the mansion tax, cutting stamp duty loopholes and removing tax relief from the pension contributions of top earners."We're hoping one of them will stick," they said.

In an interview with the BBC, Danny Alexander, the Chief Secretary to the Treasury, also played down speculation that any kind of tycoon tax was imminent. He said the Liberal Democrats were debating "Lib Dem tax policy going forward" and that the tycoon tax was "one of a number of ideas".

Asked how much money the tycoon tax could bring in, Mr Alexander said: "Well, those things are all matters for discussion." Pressed again, he added: "We haven't put forward as a party a particular rate for it. What we're trying to do this weekend is put that, along with many other ideas about tax, on the table."

Asked about opposition to the tax from Lord Oakeshott, Mr Alexander said: "Well, I think the views of one Lib Dem peer who was sacked as our Treasury Spokesman in the House of Lords a year or so ago shouldn't distract you from thinking that the Liberal Democrats very much support ideas like this to ensure that the wealthiest in this country continue to pay their fair share."

Mr Clegg used his speech to attack the assertion by the Chancellor, George Osborne, that green taxes could hamper Britain's economic recovery.

He said: "Some say we have to choose between boosting growth and being green. What a load of rubbish. Going for growth means going green."

Suggested Topics
PROMOTED VIDEO
Have you tried new the Independent Digital Edition apps?
News
ebooksAn evocation of the conflict through the eyes of those who lived through it
Arts and Entertainment
Eye of the beholder? 'Concrete lasagne' Preston bus station
architectureWhich monstrosities should be nominated for the Dead Prize?
News
Lizards, such as Iguanas (pictured), have a unique pattern of tissue growth
science
Extras
indybest
News
Anna Nicole Smith died of an accidental overdose in 2007
people
Life and Style
food + drink
Arts and Entertainment
'The Great British Bake Off' showcases food at its most sumptuous
tvReview: Bread-making skills of the Bake Off hopefuls put to the test
Extras
indybest
Independent
Travel Shop
the manor
Up to 70% off luxury travel
on city breaks Find out more
santorini
Up to 70% off luxury travel
on chic beach resorts Find out more
sardina foodie
Up to 70% off luxury travel
on country retreats Find out more
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

EYFS Teacher

£120 - £162 per day: Randstad Education Hull: Randstad Education require an ex...

Year 3 Teacher

£120 - £162 per day: Randstad Education Hull: Year 3 primary supply teacher ne...

SEN Teacher

£100 - £120 per day: Randstad Education Bristol: Supply special educational ne...

Regional ESF Contract Manager

£32500 - £35000 per annum: Randstad Education Birmingham: European Social Fund...

Day In a Page

Middle East crisis: We know all too much about the cruelty of Isis – but all too little about who they are

We know all too much about the cruelty of Isis – but all too little about who they are

Now Obama has seen the next US reporter to be threatened with beheading, will he blink, asks Robert Fisk
Neanderthals lived alongside humans for centuries, latest study shows

Final resting place of our Neanderthal neighbours revealed

Bones dated to 40,000 years ago show species may have died out in Belgium species co-existed
Scottish independence: The new Scots who hold fate of the UK in their hands

The new Scots who hold fate of the UK in their hands

Scotland’s immigrants are as passionate about the future of their adopted nation as anyone else
Britain's ugliest buildings: Which monstrosities should be nominated for the Dead Prize?

Blight club: Britain's ugliest buildings

Following the architect Cameron Sinclair's introduction of the Dead Prize, an award for ugly buildings, John Rentoul reflects on some of the biggest blots on the UK landscape
eBay's enduring appeal: Online auction site is still the UK's most popular e-commerce retailer

eBay's enduring appeal

The online auction site is still the UK's most popular e-commerce site
Culture Minister Ed Vaizey: ‘lack of ethnic minority and black faces on TV is weird’

'Lack of ethnic minority and black faces on TV is weird'

Culture Minister Ed Vaizey calls for immediate action to address the problem
Artist Olafur Eliasson's latest large-scale works are inspired by the paintings of JMW Turner

Magic circles: Artist Olafur Eliasson

Eliasson's works will go alongside a new exhibition of JMW Turner at Tate Britain. He tells Jay Merrick why the paintings of his hero are ripe for reinvention
Josephine Dickinson: 'A cochlear implant helped me to discover a new world of sound'

Josephine Dickinson: 'How I discovered a new world of sound'

After going deaf as a child, musician and poet Josephine Dickinson made do with a hearing aid for five decades. Then she had a cochlear implant - and everything changed
Greggs Google fail: Was the bakery's response to its logo mishap a stroke of marketing genius?

Greggs gives lesson in crisis management

After a mishap with their logo, high street staple Greggs went viral this week. But, as Simon Usborne discovers, their social media response was anything but half baked
Matthew McConaughey has been singing the praises of bumbags (shame he doesn't know how to wear one)

Matthew McConaughey sings the praises of bumbags

Shame he doesn't know how to wear one. Harriet Walker explains the dos and don'ts of fanny packs
7 best quadcopters and drones

Flying fun: 7 best quadcopters and drones

From state of the art devices with stabilised cameras to mini gadgets that can soar around the home, we take some flying objects for a spin
Joey Barton: ‘I’ve been guilty of getting a bit irate’

Joey Barton: ‘I’ve been guilty of getting a bit irate’

The midfielder returned to the Premier League after two years last weekend. The controversial character had much to discuss after his first game back
Andy Murray: I quit while I’m ahead too often

Andy Murray: I quit while I’m ahead too often

British No 1 knows his consistency as well as his fitness needs working on as he prepares for the US Open after a ‘very, very up and down’ year
Ferguson: In the heartlands of America, a descent into madness

A descent into madness in America's heartlands

David Usborne arrived in Ferguson, Missouri to be greeted by a scene more redolent of Gaza and Afghanistan
BBC’s filming of raid at Sir Cliff’s home ‘may be result of corruption’

BBC faces corruption allegation over its Sir Cliff police raid coverage

Reporter’s relationship with police under scrutiny as DG is summoned by MPs to explain extensive live broadcast of swoop on singer’s home