Labour pledge 7.5 billion pound tax avoidance clampdown

By William James LONDON (Reuters) - Britain's opposition Labour Party on Sunday pledged a clampdown on tax avoidance which it says would raise 7.5 billion pounds ($10.97 billion) per year, seeking to tap voter anger over perceived unfair tax rules to help win a close May 7 election. Labour announced the plan a day before it launches its election manifesto, setting out the policies which party leader Ed Miliband hopes will win over enough voters to oust Conservative Prime Minister David Cameron in what is expected to be the closest national ballot in decades. Labour's Ed Balls, the man who would become finance minister if Labour formed the next government, said the current administration had not done enough to close loopholes that allow wealthy individuals to legally reduce their tax bills. "It will take a Labour government to call time on this lax approach and launch an assault on tax avoidance," Balls said in a statement. On Wednesday, Labour won public approval with a plan to scrap 200-year-old tax rules that allow individuals to avoid paying tax on income earned overseas. An opinion poll carried out after the announcement showed 59 percent of voters supported the plan. Balls said on Sunday that he would go further if the party won power, promising to target rules on private equity firms and hedge funds, increase fines for those found to be in breach of the rules, and give tax authorities new powers. "Our 10 point plan will take the tough action needed to help us get there and we will start on day one of the next Labour government," Balls said. The Conservatives have said they would raise 5 billion pounds per year in the next parliament by cutting tax avoidance and evasion. Conservative junior treasury minister David Gauke said Labour lacked credibility on the issue because they had failed to act when the party was in power between 1997 and 2010. "Ed Miliband and Ed Balls turned a blind eye to aggressive tax avoiding and evading for 13 years when they were in charge - they were the tax avoiders' friends," he said. ($1 = 0.6836 pounds) (Editing by Jason Neely)