'Old Labour' is back, say business leaders - UK Politics - UK - The Independent

'Old Labour' is back, say business leaders

Poll shows that raising the top rate of income tax has raised fears of socialism

Business leaders believe that Gordon Brown's decision to raise the top rate of income tax marks a return to "Old Labour", according to a poll for
The Independent.

Some Blairite MPs are privately worried about the surprise move to bring in a 45p-in-the-pound tax rate on incomes of more than £150,000 from 2011. They fear it could alienate voters by suggesting Labour is reverting to type, after consistently opposing an increase in the 40p top rate under Tony Blair.

The Government will be forced to defend its mini-Budget in an emergency three-hour Commons debate today. In an unusual move, the Speaker, Michael Martin, granted a request for a debate by the shadow Chancellor, George Osborne, who accused Labour of "running away from the arguments because they are losing the argument". He said the pre-Budget report was so significant that it amounted to a full Budget, which is normally debated over five days and voted on.

The ComRes poll, taken after Monday's pre-Budget report, found 68 per cent of business leaders believe the decision signals a return to Old Labour. Only 35 per cent think it fair; and only 26 per cent that it is necessary to help the Government balance its books.

Some 72 per cent of businessmen believe the new top rate will prove self-defeating because high earners will find a way to avoid paying it.

The findings will worry ministers, who insist New Labour is alive and merely adapting its "fairness agenda" to take account of the crisis. Lord Mandelson, the Business Secretary and a founder of New Labour, was challenged at a London Chamber of Commerce breakfast meeting over whether the report showed Old Labour was back. "Emphatically not," he replied.

The Chancellor, Alistair Darling, denied he had buried the New Labour project by opting for a new top rate. "I looked at all the things you can possibly do in the tax system and decided it was better to put into place a system that is fairer to people. People who have done well over the years are going to pay a bit more," he said.

Peter Hain, the former cabinet minister who favours higher taxes for the rich, said: "This is about dealing with a serious economic situation that the world over is doing."

The ComRes survey also found business people are sceptical about the temporary reduction in VAT from 17.5 to 15 per cent. Some 72 per cent believe it will make no difference, while only 14 per cent think it will be good for their company and 15 per cent that it will be bad. Business leaders are evenly divided over whether a new £1bn scheme to give loans to small firms will help. But a majority believe the Chancellor's decision to postpone a rise in corporation tax and give companies more time to pay their tax bills will be good for their business.

Mr Darling will come under pressure to help 500,000 families who have still not been compensated for their losses from the abolition of the 10p rate of income tax. Frank Field, the former welfare reform minister, said: "Labour MPs will be less trusting next time. The Government will have to deliver the full compensation in the next Budget or face a hostile vote which this time will most certainly be pressed."

The Tories suffered some embarrassment when David Cameron asked Andrew Lansley, his shadow Health Secretary, to withdraw a remark that "recession can be good for us". Mr Lansley had said: "People tend to smoke less, drink less alcohol, eat less rich food and spend more time at home with their families." He later apologised.

News
Paper trail: the wedding photograph found in the rubble after 9/11 – it took Elizabeth Keefe 13 years to find the people in it
newsWho are the people in this photo? It took Elizabeth Stringer Keefe 13 years to find out
Arts and Entertainment
Evil eye: Douglas Adams in 'mad genius' pose
booksNew biography sheds light on comic genius of Douglas Adams
Sport
FootballFull debuts don't come much more stylish than those on show here
News
i100
PROMOTED VIDEO
Have you tried new the Independent Digital Edition apps?
News
ebooksAn unforgettable anthology of contemporary reportage
Life and Style
Kim Kardashian drawn backlash over her sexy swimsuit selfie, called 'disgusting' and 'nasty'
fashionCritics say magazine only pays attention to fashion trends among rich, white women
Arts and Entertainment
TVShows like Agents of S.H.I.E.L.D are little more than marketing tools
Arts and Entertainment
Hit the roof: hot-tub cinema east London
architectureFrom pools to football pitches, rooftop living is looking up
Travel
travel
News
The ecological reconstruction of Ikrandraco avatar is shown in this illustration courtesy of Chuang Zhao. Scientists on September 11, 2014 announced the discovery of fossils in China of a type of flying reptile called a pterosaur that lived 120 millions years ago and so closely resembled those creatures from the 2009 film, Avatar that they named it after them.
SCIENCE
Life and Style
tech
Arts and Entertainment
Matisse: The Cut-Outs exhibition attracted 562,000 visitors to the Tate Modern from April to September
art
Life and Style
Models walk the runway at the Tom Ford show during London Fashion Week Spring Summer 2015
fashionLondon Fashion Week 2014
News
Kenny G
news
News
peopleThe black actress has claimed police mistook her for a prostitute when she kissed her white husband
Life and Style
techIndian model comes with cricket scores baked in
Latest stories from i100
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

Energy Markets Analyst

£400000 Per Annum: The Green Recruitment Company: Job Title: Energy Markets An...

Junior Web Analyst – West Sussex – Up to £35k DOE

£30000 - £35000 Per Annum Plus excellent benefits: Clearwater People Solutions...

Nursery Manager

£22000 - £23000 per annum: Randstad Education Bristol: We are currently recrui...

Web Analyst – Permanent – Up to £40k - London

£35000 - £40000 Per Annum: Clearwater People Solutions Ltd: We are currently r...

Day In a Page

Mystery of the Ground Zero wedding photo

A shot in the dark

Mystery of the wedding photo from Ground Zero
His life, the universe and everything

His life, the universe and everything

New biography sheds light on comic genius of Douglas Adams
Save us from small screen superheroes

Save us from small screen superheroes

Shows like Agents of S.H.I.E.L.D are little more than marketing tools
Reach for the skies

Reach for the skies

From pools to football pitches, rooftop living is looking up
These are the 12 best hotel spas in the UK

12 best hotel spas in the UK

Some hotels go all out on facilities; others stand out for the sheer quality of treatments
These Iranian-controlled Shia militias used to specialise in killing American soldiers. Now they are fighting Isis, backed up by US airstrikes

Widespread fear of Isis is producing strange bedfellows

Iranian-controlled Shia militias that used to kill American soldiers are now fighting Isis, helped by US airstrikes
Topshop goes part Athena poster, part last spring Prada

Topshop goes part Athena poster, part last spring Prada

Shoppers don't come to Topshop for the unique
How to make a Lego masterpiece

How to make a Lego masterpiece

Toy breaks out of the nursery and heads for the gallery
Meet the ‘Endies’ – city dwellers who are too poor to have fun

Meet the ‘Endies’ – city dwellers who are too poor to have fun

Urbanites are cursed with an acronym pointing to Employed but No Disposable Income or Savings
Paisley’s decision to make peace with IRA enemies might remind the Arabs of Sadat

Ian Paisley’s decision to make peace with his IRA enemies

His Save Ulster from Sodomy campaign would surely have been supported by many a Sunni imam
'She was a singer, a superstar, an addict, but to me, her mother, she is simply Amy'

'She was a singer, a superstar, an addict, but to me, her mother, she is simply Amy'

Exclusive extract from Janis Winehouse's poignant new memoir
Is this the role to win Cumberbatch an Oscar?

Is this the role to win Cumberbatch an Oscar?

The Imitation Game, film review
England and Roy Hodgson take a joint step towards redemption in Basel

England and Hodgson take a joint step towards redemption

Welbeck double puts England on the road to Euro 2016
Relatives fight over Vivian Maier’s rare photos

Relatives fight over Vivian Maier’s rare photos

Pictures removed from public view as courts decide ownership
‘Fashion has to be fun. It’s a big business, not a cure for cancer’

‘Fashion has to be fun. It’s a big business, not a cure for cancer’

Donatella Versace at New York Fashion Week