UK Politics

UKIP's tax focus is on helping low paid, says Farage

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Media captionNigel Farage: "Thatcherism was of its time 40 years ago"

UKIP is rethinking its economic policies and no longer backs a single rate of income tax, its leader Nigel Farage has said.

In 2010, the party backed a so-called "flat tax", which it said would be set at 31% and would be achieved by merging income tax and national insurance.

But Mr Farage said he now believed an appropriate top rate of tax was 40%.

He also said he believed no-one earning the minimum wage or below should pay any tax on their earnings.

UKIP, which topped the polls in European elections last week, will set out its economic priorities at its party conference in September, when it will launch a domestic policy manifesto.

It hopes to make a breakthrough by winning its first seats in Westminster next year.

Mr Farage promised to "throw the kitchen sink" at between 20 and 40 seats where he thinks it has a realistic chance of success, including South Thanet in Kent where he said there was a "distinct possibility" he would stand.

Mr Farage also told BBC One's Andrew Marr Show that UKIP was reappraising its tax policies under new economic spokesman Stephen Woolfe.

Tax incentives

At the last general election, when Mr Farage was not leader, UKIP called for the threshold at which people start paying tax on their earnings to be raised to £11,500.

Above that amount, the party proposed that everyone would pay a single tax rate of 31%, irrespective of their income levels. The combined measures, it said at the time, would "make all taxpayers better off".

But Mr Farage said the policy was not clear and was being overhauled.

"We are going to rethink the tax thing," he said. "That was badly explained. People thought they were going to put up tax for the low paid when the idea was to abolish national insurance."

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Image caption Mr Farage says his party is targeting between 20 and 40 seats in next year's general election

The UKIP leader said his party wanted to help the millions of people whose wages had not keep pace with inflation in recent years and were struggling to get by.

"I want to give millions of ordinary people and families in this country the opportunity to live a better life and do better. What we want to do is genuinely address the cost of living and to address social mobility.

"What I can tell you for certain is that our biggest tax objective in our manifesto will be no tax on the minimum wage. You have got to incentivise people to get off benefits and get back to work."

'Not Thatcherite'

Under the current government, the so-called tax-free personal allowance will rise to £10,500 by April 2015. MPs within all the three main parties have talked about aligning the threshold with the minimum wage.

Mr Farage said he accepted that such a pledge would cost money. Asked whether this meant UKIP was unlikely to be able to offer top-earners a tax cut, he said a 40% top rate of tax was likely to bring in the most revenue.

The top rate of tax is currently at 45%. Labour have said they will increase it to 50% for the lifetime of the next Parliament while the Lib Dems say it should remain where it is.

Many Tory MPs want it lowered to 40% but the party has not spelled out its future position yet.

UKIP is seeking to convince people that it has other policies beyond its call for the UK to leave the European Union and for much tighter curbs on immigration, which it based its successful European campaign on.

'So-called earthquake'

Mr Farage said his party supported growth in selective education, believing every town should be allowed to have a grammar school, and that NHS budgets need to be re-prioritised to focus on care not bureaucracy.

The UKIP leader, an admirer of former Conservative prime minister Margaret Thatcher, rejected suggestions that UKIP was, in terms of ideology, a Thatcherite party.

"Thatcherism was of its time, 40 years ago, to deal with a specific set of problems. For half he country it benefited them. For the other half of the country, it didn't."

Labour says it is the only party that truly recognises there is "cost of living crisis" in the UK while Conservative and Lib Dem ministers have pledged to do more to ensure everyone benefits from the upturn in the economy.

The coalition government has said measures on childcare, pensions, and public sector employment practices will be among those featuring in Wednesday's Queens Speech, the last of the five-year Parliament.

Also appearing on the Andrew Marr show, Conservative minister Anna Soubry said suggestions that UKIP had transformed the political landscape by coming top in the European elections was premature.

"Can we get this into perspective? 90% of people in this country certainly did not vote for UKIP so this so-called earthquake represents less than 10% of the public," she said.

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