Cameron happy to publish his personal tax returns

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David Cameron is ready to publish details of his tax return amid controversy over whether senior politicians are paying their fair share, it can be revealed.

The Prime Minister is understood to be “very happy” for the information to be released.

Chancellor George Osborne indicated last week that the Government was considering whether ministers should be more transparent about personal tax.

He and other wealthy members of the coalition have faced intense pressure to say whether they benefited from the decision in the Budget to reduce the top rate from 50p to 45p.

The issue is also playing strongly in the London Mayoral race, where Labour candidate Ken Livingstone has been accused of channelling earnings through a corporation to minimise his tax bill. He insists there was nothing wrong with the arrangement, because his income supports an office employing salaried staff.

Downing Street sources made clear that Mr Osborne and Mr Cameron discussed disclosing tax records before the Chancellor floated the idea in an interview last week.

The move would be unprecedented for a sitting Prime Minister.

But Mr Cameron believes that people seeking the “highest office” should expect such scrutiny.

He apparently regards it as inevitable that Britain will follow in the footsteps of the US, where personal finances of senior figures are frequently released.

Mitt Romney, the Republican front-runner to take on Barack Obama for the presidency this November, recently faced criticism after admitting he paid a only small percentage of his millions of dollars in income.

Mr Cameron earns £142,500 a year as Prime Minister.

However, it is thought that income from renting out his London property could push him above the £150,000 top tax threshold.

Mr Osborne has said his earnings did not put him in the highest bracket in 2010-11.

Sources close to the premier said: “The Prime Minister is relaxed about the idea of the tax returns of senior Cabinet Ministers being published – but wants the opportunity to explore how this might work.”

The TaxPayers’ Alliance research director John O’Connell said: ““It’s inevitable that we’ve seen calls for politicians to disclose their tax affairs but it’s a huge invasion of privacy.”

After Mr Osborne’s announcement last week, a Labour Party spokesman said: “We’re in favour of more openness and transparency in politics.

“We’ll look at any proposals, and match anything the Government actually does.”

He added: “When they have decided to spend billions scrapping the 50p higher rate of tax, giving a tax break of over £40,000 to 14,000 millionaires, the least the members of the Cabinet can do is tell us if they are one of the tiny number of people who benefited from their change, and how large the windfalls they’ve received are.”