Treasurer Bill English said today it was clear Labour was starting to feel the heat from Alliance pressure to increase taxes.

"It is clear from weekend media reports that Labour is under pressure from the Alliance over the promised tax inquiry and Dr Cullen has now confirmed that he would move rapidly after the election to set it up. However, he is still trying to hold off giving any detail until after the election.

"But you don't have a tax inquiry unless you're looking for more ways to tax people. There's only one way that taxes are going to go after this inquiry and that's up.

"The Alliance is quite up front about wanting to see more taxes. A financial transactions tax, capital gains tax, death duties, a land tax, higher income taxes, and more taxes on Family Trusts are all on the Alliance list.

"Dr Cullen is already under enormous pressure from his own caucus to spend more. He has had to allow Labour MPs to announce policy without providing costings, such as the broadcasting policy and an estimated $70 million give-away to the West Coast. Once you add the big-spending Alliance to the equation the pressure for more tax is intense.

"Labour should be honest with voters and admit before the election that there will be new taxes as well as higher taxes under a Labour-Alliance coalition government," said Mr English.

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