Shadow chancellor John McDonnell is to launch a wholesale review of Labour's economic policies, looking at measures to shift the burden of tax away from middle and low-earners, a Robin Hood Tax on financial transactions and possible changes to the mandate of the Bank of England.
He dismissed as "fantasy" Conservative claims that he was planning "damaging tax rises on jobs, investment and earnings", insisting Labour's focus was on growing the economy, making sure corporations paid their taxes and halting Tory tax cuts for the rich.
The review being launched in his first major speech as shadow chancellor, at Labour's Brighton conference, will draw on all strands of opinion among the party's MPs and members, he said. And the general public will be invited to have their say.
Mr McDonnell predicted "heavy debates" and "dissent" as new policies are drawn up, but insisted that this would not mean the party was split, warning: "Don't confuse democracy with disunity."
He told BBC1's Breakfast: "What we are doing today is opening up one of the biggest debates on our economy this country has ever seen.
"Everyone will have their say, so the future policies of the Labour Party will be determined by the British people themselves, having faith in the people - trust the people."
"We will be able to come up with the ideas, then we will rigorously test them and test them again until we know they will work in the interests of everybody and not just the rich elite in this country."
Proposed policies will be tested by a new economics advisory committee including internationally renowned economists Joseph Stiglitz and Thomas Piketty, and Labour will ask for access to public finance watchdog the Office for Budget Responsibility and the Bank of England to help model its proposals, said Mr McDonnell.
He said the openness of the debate would provide "a breath of fresh air in British politics".
"This new politics that's been introduced since Jeremy Corbyn's election is basically saying our members are the people who own this party, it's our members who will make the policy," he told Sky News. "All of us - MPs, members of the shadow cabinet - will all be participating in our debate and our policy making. We're all equal now and we will all be involved in this debate and it will be democracy. Don't confuse democracy with disunity.
"It's a new politics, it's fresh, and people will be able to dissent and we will have fairly heavy debates, but in some ways that's the best way to get the right decisions, where all voices are heard and then we come to a democratic decision."
Conservatives predicting massive tax hikes "must have been affected by the lunar eclipse last night", he told ITV1's Good Morning Britain.
Labour was now "an anti-austerity party", he said. But he added: "What we are saying is we recognise there is a deficit and we are going to tackle that deficit,.
"Yes, we are going to vote against some of the tax cuts for the rich that the Conservatives are introducing, our main thrust is around making sure that we tackle tax evasion, tax avoidance.
"But more importantly, we want to start growing the economy."
The veteran campaigner defended the use of street protests and occupations as tactics to highlight problems with the way the economy worked, but insisted that any direct action must be "non-violent, and not upsetting anyone".
He dismissed as "absolute rubbish" suggestions that moderate Labour MPs will be targeted for deselection, after The Times printed a leaked email from a senior union official apparently suggesting the constituency Labour parties (CLPs) of those opposing new leader Jeremy Corbyn should be stuffed with new left-wing members.
Mr McDonnell told Sky News: "This is not about deselecting anyone, it's about making sure we all come together. The message from this conference and from Jeremy's speech will be unity - everybody come back together and engage in this debate, but more importantly respect each other's views. No deselections, let's just get on with the job of winning the next election."
He confirmed his review will consider extending the Bank of England's mandate to include not only a 2% inflation target, but also measures of "prosperity within the economy (and) long-term investment in the infrastructure".
The operations of HM Revenue and Customs will also come under examination, as part of a bid to target a £120 billion "tax gap" between taxes due and sums collected, of which he estimated £25 billion could be retrieved.
He said a Robin Hood Tax on transactions in the financial markets had been Labour policy for some time, so long as it was introduced globally so as not to disadvantage the UK.
Asked whether he stood by the entry in Who's Who in which he described his pastime as "fomenting the overthrow of capitalism", Mr McDonnell said: "What I'm saying is we have got to transform the existing economic system because it's simply not working for people."
Former home secretary Alan Johnson, often tipped as a potential party leader, said he expected Mr Corbyn to remain in post for a decade.
He told BBC Radio 4's Today: "I think he will be the leader at the next election. Anyone who is voted in that emphatically should be there for, I think (deputy leader) Tom Watson said 10 years. I think that's probably true."