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Business leaders back Conservative tax cut 1 April 2010
Caroline Copley (about the author)

Bosses at some of Britain's biggest companies have come out in support of the Conservatives' plans to cut a planned rise in National Insurance, as the economy dominates the pre-election political stage.

In a letter to the Daily Telegraph published on Thursday, 23 senior business leaders, including nine heads of FTSE 100 companies, welcomed the Conservative's pledge, saying a rise in the payroll tax would harm the economy.

"The government's proposal to increase National Insurance, placing an additional tax on jobs, comes at exactly the wrong time in the economic cycle."

"As taxpayers we would welcome more efficiency in government. As businessmen we know that stopping the National Insurance rise will protect jobs and support the recovery."

Signatories of the letter include Justin King, head of supermarket chain Sainsbury, Paul Walsh, chief executive of beverage giant Diageo and Stelios Haji-Ioannou, founder of low-cost airline easyJet.

Conservatives acused of panic measures

Earlier this week the Conservatives said they would exempt most Britons from a planned rise in National Insurance, funding the measure through efficiency savings worth an initial 6 billion pounds.

Prime Minister Gordon Brown accused the Conservatives of a "panic measure" that would jeopardise a fragile economic recovery. His Labour party, in power since 1997, has been closing the gap on the Conservatives in recent opinion polls.

The economy is the key election issue, expected on May 6, with the Conservatives pushing for faster and deeper cuts in Britain's 167 billion pound budget deficit than Labour is calling for.

Labour has focused its attacks on the shadow chancellor George Osborne accusing him of repeatedly making the wrong calls during the banking and economic crisis.

In an interview published in Thursday's edition of the Financial Times Cameron dismissed this criticism saying he believed Osborne was "the right person to do the job."

But a Reuters poll of 31 economists published on Wednesday showed they were lukewarm towards Osborne, ranking him fourth of five potential finance ministers.

Conservative business spokesman Ken Clarke, chancellor of the exchequer in the last Conservative government in the 1990s, was their top choice.

Source: Reuters