LABOUR will today target the UK's economic institutions, including the Bank of England, after Jeremy Corbyn called for tax cuts for the low paid.

John McDonnell, the shadow chancellor, will announce a "radical review” of financial levers as he sets out the party’s vision for wealth redistribution.

Mr McDonnell will today say he wants growth to be shared “more equally” across the UK.

But his predecessor has already warned that Labour risks being laughed at if it tries to persuade voters it has "magical solutions".

Yesterday Mr Corbyn told the BBC’s Andrew Marr programme that he “would hope” to cut the lower rate of tax.

He also backed an increase in the top rate from 45 to 50p, hit out at the current inheritance tax system and attacked David Cameron’s tax credit cuts.

In particularly strong language he criticised companies who move their headquarters out of the UK, he said, to “pay lower tax”.

In a surprise move, Mr Corbyn also announced that he has recruited one of Nicola Sturgeon’s most high-profile economic advisers.

Professor Joseph Stiglitz, a Nobel prize winner and economist, will be part of a new group tasked with developing ideas for the Labour leadership.

Mr McDonnell will face pressure to set out his economic strategy today after a controversial announcement at the weekend that Labour would back the Tories' target to erase the deficit by 2020.

Mr Corbyn received plaudits during the leadership election by standing on a stronger anti-austerity platform than his rivals.

Yesterday Mr Corbyn said: “Inheritance tax has been reduced so the richest 60,000 families have suddenly had a huge tax break.”

He criticised the government's record on business, saying: “If a company is operating in Britain, as is Boots or many others, making, yes, good business, making a lot of money in Britain, they should pay tax on what they earn in Britain and not by some piece of sophistry move it to Switzerland, Liechtenstein or Luxembourg."

He added: "The bottom rate of income tax I would hope we could lower if we can to help the poorest, the very lowest earners.

"I would want to keep the top rate at 50 per cent, 50p, I have no plans to raise it beyond that and neither has John."

But former shadow chancellor Chris Leslie appealed to Mr Corbyn not to draw up "battle lines" with the business community.

He also urged Mr Corbyn and Mr McDonnell to tone down "aggressive" rhetoric which would put business off the party.

And he warned that Labour risked being "laughed out of court" if it attempted to persuade voters it had a "magical solution" to cut the deficit without controlling public spending or raising taxes.

His new leader’s plan to print money for public investment, "people's quantitative easing", was "not a viable way forward for the economy", he added.

Prof Stiglitz will advise Labour alongside Capital author Thomas Piketty and former Bank of England monetary policy committee member Danny Blanchflower.

An SNP spokesman said:"Given that John McDonnell has just confirmed he still supports George Osborne's fiscal charter, people across the UK will be hoping that his advisers will convince Labour of the folly of continuing with Tory austerity policies."