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UK Conservatives Put Tax Cuts Onto Back Burner

by Robert Lee, Tax-News.com, London

02 December 2003


A future Conservative government would have to wait several years before introducing tax cuts, the party’s Treasury spokesman Oliver Letwin revealed on BBC Television on Sunday.

In one of the first major policy shifts of the new shadow cabinet since Michael Howard took over the leadership of the party from Iain Duncan Smith, who advocated early tax cuts under a new Conservative government, Mr Letwin suggested that it would be “irresponsible” to pledge tax cuts in the short-term without being certain that they could be delivered.

Speaking on the BBC’s ‘Politics Show’ Letwin said the first priority of a Conservative government should be “fundamental structural reform” of public services with low taxation a medium to long-term aim.

"I believe that the reforms are going to be things which create a better bang for the buck over the medium term," he said. "But in the short term I don't believe that we will be able to get savings out of those policies. Indeed there may be transitional costs."

"I'm clear about only two things, first that we can't make any kind of irresponsible pledge to any specific act. And second, I know that over the medium and long term if Britain is a low tax economy then it will be more likely to be a prosperous economy," argued the shadow Chancellor. However, he suggested that tax cuts may not be possible for at least five years after a Conservative election victory.


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