David Cameron has promised that a Tory government would use environmental levies not just to tackle global warming but also to cut the tax burden on Britain's low and middle income earners.

In a major speech on 'Meeting the Economic Challenges of the Future' at the London School of Economics, the opposition leader called for action both to tackle climate change and reduce inequality across Britain.

He said as chancellor Gordon Brown had strangled business with regulation and extra taxes, while doing little to help the worst off in society.

Attacking the prime minister directly, Cameron said: 'By using green taxes as extra stealth taxes, Gordon Brown has given them a bad name. I'm determined that the Conservative approach will be different.

'We will raise green taxes, and use the proceeds to reduce taxes elsewhere… any revenue raised from new green taxes will be used to reduce the burden on those striving hard for a better life.'

On business taxes Cameron said: 'We need a radical simplification of business taxes, to lower the rate and broaden the base. Government must regulate and tax enterprises less.

'Our economy is labouring under the highest tax burden in our peacetime history, the longest tax code in the world, and an explosion of new regulations that cost us more than £50bn a year. Just last week we heard that the latest version of Tolley's tax handbook is more than twice as long as it was in 1997. The publishers even had to change the formatting just to stop it going to five volumes.'

Andy Burnham MP, Labour's chief secretary to the Treasury, responding to today's speech by Cameron, said: 'The Tories are at sixes and sevens on tax. Yesterday, they were saying they would be cutting green taxes. Now today, David Cameron has confirmed they will be raising them.

'The truth is the Tories would need to raise green taxes by eye-watering amounts to meet the tax proposals they have been making.'

Further reading

Tolley's reduces print size as tax complexity grows