Responding to David Cameron's pledge to cut Corporation Tax to 25%, Liberal Democrat Shadow Chancellor, Vince Cable said:

"If the Tories want to claim that they are going to cut corporation tax, they have to come clean about how they are going to pay for it.

"Cutting the main rate of corporation tax to 25% will cost more than £5bn a year. If David Cameron is to have a hope of sounding credible he must state clearly where the money will come from. Otherwise this will be seen as yet another unfunded tax cut.

"If the Tories intend to cut the main rate of corporation tax by abolishing other tax reliefs, they must have the guts to say this.

"The Liberal Democrats have long argued that corporation tax should be lower, but we have had the courage to say that business must pay for this through the scrapping of other business allowance and the R&D Tax Credit.

"Cameron's pretence that the Conservatives are a government in waiting is laughable when it seems all his polices are worked out on the back of a fag packet."