Labour 's flagship economic plan to increase taxes on big business to ease the pressure on the high street could cost 100,000 jobs , David Cameron claimed today . The Prime Minister said the proposal to hike corporation tax for the first time in 40 years was 'crazy ' . Corporation tax is set to fall from 21p to 20p tomorrow – but Labour have pledged to reverse the cut to help reduce business rates for millions of smaller firms . Corporation tax is set to fall from 21p to 20p tomorrow – but in a speech today in Swindon Labour 's shadow chancellor Ed Balls pledged to reverse the cut to help reduce business rates for millions of smaller firms . Shadow Chancellor Ed Balls said he would use the first budget of a Labour government to cut business rates for 1.5 million small companies - worth an average of £400 to each firm – and then freeze them the following year . Speaking in Swindon on the first full day of the election campaign this morning , Mr Balls said 17 small firms would benefit from the cut for every one large business helped by the Coalition 's reduction in corporation tax . He said : 'It 's not right to go ahead with the further cut for larger companies when we can use the money in a better way to help us create more good jobs by backing small companies . ' Mr Balls said he would use the first budget of a Labour government to cut business rates for 1.5 million small companies - worth an average of £400 to each firm – and then freeze them the following year . Mr Balls said the coalition spent £7 billion over the last five years cutting the main rate of corporation tax to the benefit of larger firms while revenues from business rates rose by £3 billion , at an average cost to firms of £1,500-a-year . Will Straw , the son of former Foreign Secretary Jack Straw , was out campaigning in Blackburn today . He is standing for Parliament in the Rossendale and Darwen constituency . Mr Balls added : 'Unleashing the potential of smaller businesses to grow , create more good jobs and raise living standards is a vital part of Labour 's better plan . 'This is part of our plan to deliver a simpler and fairer tax system for small businesses . This is the right priority when money is tight . And it will mean that the tax burden on small businesses will be lower with Labour than under the Tories . ' However the move risks re-opening the rift with some big business leaders who have strongly criticised Labour 's spending plans . It comes after some company bosses complained at the way comments they had made expressing concern about the prospect of Britain leaving the EU were included in a Labour advertisement attacking the Conservatives . Mr Cameron – who this morning set out the Conservative pledge to boost employment by two million over the next five years – told Sky News 's Sunrise that Labour 's plan to raise corporation tax was ' a crazy thing to do when the economy is growing ' . Tory Treasury minister David Gauke said that abandoning the cut in corporation tax would jeopardise economic security . He said : 'This would be the first time corporation tax has risen in over 40 years and Labour 's plans could cost 96,400 jobs - it would put people 's economic security at risk . 'The Conservative Party is helping businesses small and large as part of our long-term economic plan - we do n't divide them up for the sake of making a political point . '
Ed Balls unveiled proposal to cut business rates for millions of small firms . But it will be paid for by reversing the Coalition 's 1p corporation tax cut . The PM said it was 'crazy ' to hike corporation tax for first time in 40 years . Mr Will Straw claimed the tax increase would cost 96,400 jobs .