Miliband promises tax rises to limit spending cuts

Labour leader promises to increase taxation on banks and tackle tax avoidance.

Ed Miliband has given his strongest signal yet that he would raise taxes in order to limit the level of spending cuts. In an interview with Channel 4 News, the new Labour leader emphasised his determination to "improve" Alistair Darling's deficit reduction plan, which would have seen two thirds come from spending cuts and one third from taxation.

"We should look to do more from taxation. For example, taking more from banks or tackling tax avoidance," he said. "If I was in government at the moment, I would be looking - whether it is a tax on the banks or tackling tax avoidance - to lighten the load and the cuts and the impact that it is going to have on ordinary families. I would do more from taxation than Alistair proposed in his plan."

The coalition plans to reduce the deficit through a ratio of 77 per cent spending cuts to 23 per cent tax rises. In a preview of the strategy they plan to use to discredit Labour's new leader, the Conservatives claimed that Miliband would have to raise taxes by a further £35bn -- the equivalent of 7p on the basic rate of income tax -- in order to meet the spending commitments he made during his leadership campaign.