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Labour defends 50p tax plans after business backlash

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Labour defends 50p tax plans after business backlash

Labour has defended its plans to bring back the 50p top tax rate, if its wins the election in 2015, after the idea was attacked by business leaders and some party donors.

The 50p top tax rate of income was introduced by the last Labour government in 2010 for anyone with income of more than £150,000.

The coalition government since reduced the rate to 45p. The Conservatives have questioned whether the tax brought in extra revenue for the government.

Shadow chancellor Ed Balls (pictured) unveiled Labour's plan during a speech at the Fabian Society on Friday. On Sunday, he hit back at criticism of the plans from business leaders, telling the BBC's Andrew Marr Show that the tax would be temporary and was not anti-business.  

Balls suggested the 50p rate would only be in place while Labour cleared the budget deficit, which it aims to do by 2020. He also ruled out raising it further.

A number of business leaders have attacked the plans, with 24 company bosses signing a letter to theTelegraph in which they called the plans ‘a backward step’, arguing it would impact the economic recovery and jobs.

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