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Plan to Tax Top Earners Discussed in Liberal Democrat E-Mail

Sept. 16 (Bloomberg) -- An e-mail accidentally sent to journalists by U.K. Deputy Prime Minister Nick Clegg’s Liberal Democrat party discussed a proposal to increase taxes on people who earn more than 50,000 pounds ($80,000) a year. A spokesman said it wasn’t party policy.

The e-mail, entitled “Conference Top Lines” and marked “not for forward distribution,” was intended for lawmakers talking to the media today at the party’s annual convention in Glasgow, Scotland. It was instead sent out by party headquarters to reporters attending the conference.

“We are looking at how the richest 10 percent of people, those earning over 50,000 pounds, could make a further contribution,” the memo instructed Liberal Democrat lawmakers to say. “The vast majority of people in the country would consider 50,000 pounds a very large salary: these are not the middle-income earners.”

A spokesman for Clegg said the party had no plans for such tax increases. Speaking on the usual condition of anonymity in line with party rules, he said that while the e-mail was authentic, it was mistakenly copied from a year-old policy document. The party is not actively looking at increasing taxes on higher earners, though it retains its belief that wealth should be taxed, he said.

“I certainly won’t be arguing for higher marginal rates of income tax,” Liberal Democrat Business Secretary Vince Cable told BBC Radio 4’s “World at One” program.

“I haven’t seen this memo,” Chief Secretary to the Treasury Danny Alexander said at a meeting with activists in Glasgow. “I don’t know what it is or why it’s getting you excited.”

Attack Lines

Along with answers to potential questions ranging from government borrowing to cider taxation, the memo also gave lawmakers lines they could use to attack both the opposition Labour Party led by Ed Miliband and Prime Minister David Cameron’s Tories. With the next general election 20 months away, Clegg is seeking to win back voters alienated by his 2010 decision to go into government with the Conservatives and to position the Liberal Democrats at an equal distance between the two bigger parties.

“The Conservatives on their own cannot build a fairer society,” the memo instructed Liberal Democrat lawmakers to say. “In government we have blocked Tory plans to allow bosses to fire staff at will, give an inheritance-tax cut to millionaires and let schools be run for profit.”

A YouGov Plc poll published today of people who voted Liberal Democrat in 2010 found 59 percent saying the party had become worse since then, against 9 percent who said it had improved. YouGov interviewed 1,593 adults Aug. 30 to Sept. 4.

The e-mail told lawmakers to attack Labour by saying the party “cannot be trusted to build a stronger economy.”

While guidance on how to talk about the Tories did not mention Cameron by name, Miliband was singled out as a “weak leader of a divided party that has nothing to say about the big issues of the day.”

To contact the reporters on this story: Kitty Donaldson in Glasgow, Scotland, at kdonaldson1@bloomberg.net; Robert Hutton in Glasgow, Scotland, at rhutton1@bloomberg.net

To contact the editor responsible for this story: James Hertling at jhertling@bloomberg.net

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