Osborne tax hike claim sparks row

Mr Osborne claims Labour is concealing a "tax bombshell"

The Conservatives have claimed Gordon Brown was planning a secret post-election income tax hike - sparking angry denials from Labour ministers.

Shadow chancellor George Osborne said leaked Treasury papers showed a £14.8bn hike in expected receipts in 2011/12 that could need a 3p tax rise.

But the Treasury said the jump in receipts was down to expected economic growth and the new 50p top rate of tax.

Foreign Secretary David Miliband accused Mr Osborne of a "big smear".

The Tory claim was also dismissed by the Lib Dems.

The government says the tax projection statistics were already in the public domain and had been published at the time of the Budget.

But the Tories said those tax changes only account for £2bn of the increase and the rest of the gap was "nowhere near what is possible" from economic recovery.

'Misleading'

Mr Osborne said: "Labour's secret spending plans, which Gordon Brown never wanted to make public, appear to reveal an income tax bombshell.

"Income tax receipts are set to rise by a third. Are they asking us to believe that this is due only to recovery from recession and the 50p rate?"

Treasury minister Liam Byrne accused Mr Osborne of "trying to mislead the public" and said the claims raised "serious questions" about the shadow chancellor's judgment.

"Osborne's claims are false. These government tax projections are already published and are in the public domain.

"They simply set out what is raised by our existing published measures as the economy returns to growth. No more, no less."

Foreign Secretary Mr Miliband told Sky News the Tories were engaged in "the politics of the big lie and the big smear".

Liberal Democrat economics spokesman Vince Cable said government figures were optimistic but the Tories have "put two and two together to make five".

It comes as Schools Secretary Ed Balls outlined how he hoped to slash £2bn from the schools budget.

Up to 3,000 senior staff, including heads and deputies, could be axed as schools are merged into "federations" run by a single team, most by natural wastage, Mr Balls said.

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