LONDON, June 29 (Reuters) - Britain’s opposition Labour party will on Monday attempt to cast off accusations that its left-leaning policies have made it ‘anti-business’ by proposing tax changes designed to increase long-term investment and foster greater competition.
Since Labour announced plans to force energy firms to freeze their prices last September, businesses have become increasingly concerned about how much political intervention they would face if, as a narrow lead in opinion polls currently suggests, the party wins an election next May.
Economy spokesman Ed Balls will promise an approach to tax and the economy that is “pro-business, but not business-as-usual”.
“If we are to maintain public support for an open market economy, we need to address public concerns, promote competition and long-term investment and make sure markets like energy and banking work better for consumers and businesses alike,” he will say, according to advance extracts of his speech.
Party leader Ed Miliband has said markets need more rules, and promised regulation to better protect consumers in industries from banking to private housing, prompting concern from business lobby groups and some of the party’s own backers.
Labour would look to introduce a tax break designed to ensure equity- and debt-financed investments are treated equally and which exempts some profits from taxation, Balls said.
The move, known as an “allowance for corporate equity”, was recommended by leading economic think-tank the Institute for Fiscal Studies in 2010.
Balls also mooted the idea of other tax breaks to encourage longer-term investors, including a lower rate of capital gains tax on such investments. (Editing by Sophie Hares)