Britain's Labour party proposes mansion tax to help low earners

LONDON, Feb 14 (Reuters) - The leader of Britain's opposition Labour Party called on Thursday for a tax on expensive homes to fund a new lower-income tax band to help the country's lowest earners.

Setting out some of the first concrete ideas of what his party would offer voters at the next election, which is expected in 2015, Ed Miliband said a Labour government would introduce a tax on houses worth over 2 million pounds ($3.1 million).

"We would use the money raised by a mansion tax to reintroduce a lower 10 pence starting rate of tax, with the size of the band depending on the amount raised," Miliband said in a speech.

He conceded that the former Labour government had been wrong to abolish the 10 pence starting rate of income tax.

"We would put right a mistake made by Gordon Brown and the last Labour government," he said, saying the move would benefit 25 million basic rate taxpayers.

Miliband said the changes would help ensure that lower earners, and not just the wealthiest, would be rewarded by success in the economy.