UK's Liberal Democrats target tax cheats

20 Sep, 2010

Britain's Liberal Democrats, seeking to show they are pulling their weight in coalition, unveiled government plans on Sunday to raise an extra 7 billion pounds ($11 billion) by tackling tax cheats.
Party leader Nick Clegg urged members gathered in the northern English city of Liverpool not to panic about a slide in poll ratings after he led them into Britain's first coalition government since World War Two five months ago.
Clegg's Liberal Democrats have seen their support slump since they became junior partners in a Conservative-led administration following the national election in May.
The government's main goal is to virtually eliminate a budget deficit running at 11 percent of national output by the end of its five-year term. It plans spending cuts that could threaten the jobs of hundreds of thousands of public sector workers.
Clegg is under pressure to demonstrate he has not abandoned his centre-left party's principles by joining the right-leaning government. Some Liberal Democrats have voiced concerns that the poor will carry too heavy a burden from austerity measures.
The spending cuts are likely to prove deeply unpopular and some critics say the fresh-faced Clegg, 43, who is deputy prime minister, risks leading the Liberal Democrats into oblivion.
"This is a marathon, not a sprint," Clegg told delegates who questioned him during a session of conference, telling them not to lose their nerve after finally getting into power after decades in the political wilderness.
"You cannot build social justice on the sands of debt," added Clegg, who appeared relaxed in an open-neck shirt and was greeted with ripples of applause from the audience before a final standing ovation.
No one expects the Liberal Democrats to quit the coalition immediately, but the partnership could be jeopardised if they fail to secure cherished electoral reform in a referendum next year or perform poorly in local elections.
The Liberal Democrats and the Conservatives were not regarded as natural partners before the election that ended 13 years of Labour rule. However, they reached a quick coalition agreement after the Liberal Democrats signed up to swift spending cuts because of the financial crisis in the neighbouring eurozone.
The Liberal Democrats talked tough on tax avoidance, keen to balance combative Conservative language on cracking down on poorer benefit claimants. "We will be ruthless with those often wealthy people and businesses who think they can treat paying tax as an optional extra," Treasury minister Danny Alexander said.
He promised a fivefold increase in prosecutions against tax dodgers and a crackdown on offshore tax avoidance.
The aim is to boost tax raising by 7 billion pounds by 2014-15, a relatively small sum compared to a budget deficit forecast to reach around 150 billion pounds this year.

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