Blair says tax breaks for private equity raise ’real issues’

As senior buyout firms go before the UK Parliament’s Treasury Select Committee, UK prime minister Tony Blair has pledged a review into the taxation of private equity to be published at the time of the Pre-Budget Report.

UK prime minister Tony Blair has said tax breaks for Britain’s private equity industry raise ”real issues’’  and he has pledged a review of private equity taxation by the autumn.

“Of course people have concerns about this, which is why we have said we would look into it in a sensible and serious way and reflect on what we can do,” Blair said during prime minister’s questions, the weekly debate at Westminster.

Liberal Democrat leader Menzies Campbell asked Blair if the “wealthiest individuals” in the UK should receive tax breaks worth £6 billion ($12 billion) a year and he demanded Blair reverse the policy and trim taxes for “lower and middle income families.”

Campbell also echoed SVG chairman Nicholas Ferguson’s remarks to the UK newspaper Financial Times at the beginning of the month, asking the prime minister if he felt it right for industry executives “to pay tax at a lower rate than those who clean their offices”.

Blair today said the government’s study of taxation on the industry will be published with the Pre-Budget Report, which is normally released in November or early December.

The debate in the House of Commons came at the same time as the UK Parliament’s Treasury Select Committee began its second session on private equity.