Bosses at some of Britain's biggest companies have backed the opposition Conservatives' plans to curb a planned payroll tax rise in the latest pre-election skirmish, according to Reuters. Conservative leader David Cameron said the declaration was a "very important moment" ahead of an election expected on May 6, while ruling Labour hit back that unfunded Conservative policies implied a 22-billion-pound ($33 billion) "credibility gap". In a letter to the Daily Telegraph newspaper published on Thursday, 23 senior business leaders, including nine heads of FTSE 100 companies, welcomed the Conservatives' pledge, saying a rise in national insurance contributions 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," they said. "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 British supermarket chain J Sainsbury, Paul Walsh, chief executive of beverage giant Diageo and Stelios Haji-Ioannou, founder of low-cost airline EasyJet. Cameron, who will become prime minister if the Conservatives win the election, did a round of morning interviews to trumpet news of the backing from business leaders. "I think it is a very important moment in the election campaign," he told the BBC. "These household names - people like Marks & Spencer, Sainsbury's and Mothercare - are saying that Labour's plans to put up national insurance contributions are the biggest threat to the recovery." "KID IN A SWEET SHOP" Three senior Labour figures mounted a counter-attack at a press conference during which they accused the Conservatives of making promises they would not be able to afford if elected. "The Conservative Party wants to face two ways - promising extra tax cuts and spending commitments while at the same time claiming they will reduce the deficit further and faster than our plan to halve it in four years," said Alistair Darling, the finance minister. Peter Mandelson, the business secretary, sought to minimise the impact of the letter from business leaders. "Of course there will be some in business who are going to support what appears to be a pain-free tax cut. Who wouldn't if offered that? But the fact is this is not pain-free," he said. Labour ministers have been systematically targeting George Osborne, the Conservatives' finance spokesman, whom they see as a weak link in the opposition party's line-up. "George Osborne is behaving like a kid in a sweet shop who thinks that he can just grab sweets from any jar without paying for them at the counter," Mandelson told the press conference. Earlier this week the Conservatives said they would exempt most Britons from the planned payroll tax rise, funding the measure through efficiency savings worth an initial 6 billion pounds ($9 billion). The economy is the key election issue, with the centre-right Conservatives pushing for faster and deeper cuts in Britain's 167 billion pound ($252 billion) budget deficit than Labour is calling for. Labour says premature cuts risk stifling a fragile economic recovery.
