JAMES CHAPMAN, TIM SHIPMAN and HUGO DUNCAN 
Mail Online 
January 26, 2012

Household budgets are ‘approaching a state of emergency’ and taxes must be cut now for 23million low and middle earners, Nick Clegg will insist today.

As figures showed the economy shrank by 0.2 per cent in the last three months of 2011, the Deputy Prime Minister will demand that income tax for basic rate taxpayers is slashed so that the first £10,000 in earnings is tax-free.

‘The pressure on family finances is reaching boiling point,’ he will say.

‘Cutting income tax is one of the most direct tools we have to ease the burden on low and middle earners.’ 

The Liberal Democrat leader will also call for the rich to pay more to fund tax breaks for struggling families.

The Deputy Prime Minister’s intervention comes after statistics showed Britain has endured the slowest recovery from recession since the Great Depression.

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