Blears pledges to pay home sale tax

Acknowledging "public outrage" about MPs' expenses, the Communities Secretary brandished a cheque she said she would be sending to the Inland Revenue.

Ms Blears told Commons authorities a flat in south London was her second home, meaning she was able to claim back thousands of pounds in mortgage interest and running costs.

Yet when she sold the flat in Kennington, at a profit of £45,000, she paid no capital gains tax (CGT) on the windfall, indicating the flat was simultaneously registered with the taxman as her primary residence.

Ms Blears said: "My position is that I'm the MP for Salford and I'm absolutely determined to make sure that my reputation, and my relationship with the people that sent me here to speak up for them, is rebuilt and that's the most important thing to me at the moment."

She went on: "I'd never knowingly do anything to let down the people I serve, and I've been affected personally by what people have been telling me in the past couple of days.

"I have decided it's not enough to comply with the rules and the law. What matters is what people think and feel about the issue. I am sending a cheque to the taxman, which represents the equivalent of the amount of capital gains tax I would have paid if I had been liable."

Asked whether she had decided to pay the money at the prompting of the Prime Minister or Chief Whip, she said: "I have decided to do this. I have talked it over with my family. The single most important thing in my life is my relationship with my constituents in Salford."

The row over the MP's tax affairs arose after receipts leaked to the Daily Telegraph revealed she received expenses towards three properties in 2004.

In March, she designated her second home as a house in her Salford constituency, which she has owned with her husband since June 1997, and bought an £850 television and video recorder and a £651 mattress for that address. The following month she declared the Kennington flat as her second home.