Broughton hits out at 50p rate

OUTGOING CBI president Martin Broughton slated Alistair Darling’s Budget last night, and said the 50p top tax rate was “a piece of economic vandalism.”

Speaking at the CBI’s annual dinner, he said the Budget had not helped out the ailing economy, and that its measures had been based on “heroic growth assumptions”.

And he said the tax rate equated to a “tearing up of the manifesto commitment to the country’s entrepreneurial class.”

He also hit out at the government for trying to divert media attention away from its failure to tackle the growing deficit.

Broughton said focusing on core services and cutting back on non-essential ones was preferable to putting up income tax.

But Prime Minister Gordon Brown defended the tax, and said it was in fact necessary to address the growing deficit.

Brown added that it was a duty of the government to boost the economy, and the UK’s deficit wouldn’t start to drop until its economy started to grow.

He claimed the 10-year plan from the government would eventually bring the country’s tax regime back to a reasonable level, and that the 50p tax rate for those earning over £150,000 was part of that plan.

“I regret the fact that in our plan for sustainable public finances, which includes very substantial efficiency savings in the public services, we have also had to take decisions on taxation,” he said.

And he insisted that the economy was better placed to fight against the downturn than it had been in previous recessions.