Liberal Democrats to call for tax cut in local elections launch

The Liberal Democrats have been calling for a tax cut to ease a "cost of living emergency" as they start campaigning for upcoming English local elections.

Lib Dem leader Ed Davey will launch the party's campaign with a call to slash VAT, which it's claimed would save families £600.

He says budgets are being stretched by a National Insurance (NI) rise taking effect on Wednesday.

And he will accuse the Tories of breaking promises by raising taxes.

The rising cost of living - driven by global economic turmoil and the war in Ukraine - has been a key issue ahead of the elections, which will test support for political parties across the UK.

The polls will take place on 5 May, when votes will be held to elect local councils in England, Wales and Scotland, and the government in Northern Ireland.

The Lib Dems will compete with Labour in some places in these elections, but the party's priority will be targeting long-standing Tory voters.

To woo these voters, the Lid Dems say they will put the cost of living at the centre of their election campaign in England.

One measure they are proposing is a cut to value added tax (VAT) from 20% to 17.5% for one year, a move they predict would save families an average of around £600.

The party says its plans would give a boost to struggling high street businesses by encouraging spending, and help keep costs under control by reducing prices in the shops.

"There's a cost of living emergency and that's why Liberal Democrats are calling for this emergency tax cut," Mr Davey told the BBC. "It is a large one, but it's right for the times."

The Lib Dem local elections offer will include proposing a sewage tax on water companies to fund the clean-up of rivers in the UK.

They also want to establish a national community ambulance fund to allow trusts to reopen ambulance stations and cancel planned closures.

Lib Dem analysis of Office for Budget Responsibility figures shows that Chancellor Rishi Sunak will receive a VAT windfall of £38.6bn over the next four years.

That calculation takes into account rising costs, which the party says will see a typical family will pay an estimated £430 more in VAT next year.

The party says the rising VAT bill "comes on top of the Conservative government's manifesto-breaking increases" to tax, with the income tax threshold frozen and NI rising by an extra 1.25p in the pound.

The hike in NI contributions is forecast to raise £39bn over three years and is being used to fund the NHS and social care.

Together, the tax rises will leave a typical family £535 a year worse off, even before the extra VAT pinch is felt, according to the Lib Dems.

Mr Davey said the government's approach to tax policy was not fair "because it puts the burden on working people, particularly low-paid people".