50p tax rate set to stay until 2015
The top rate of tax of 50% for those that earn over £150,000 a year will not be abolished in the near future according to newspaper reports.
It was believed that the rate could be cut to 45p either this year or in 2013, but the government has now dismissed this possibility, reports the Daily Telegraph.
The 50p tax rate was introduced in 2010 by the Labour government but has been unpopular amongst business leaders who say that this will drive wealthy entrepreneurs abroad and could damage the City of London. However, research shows that the rate is general popular amongst the public.
In an interview with on the BBC’s Andrew Marr show on January 8, when asked about the tax the Prime Minister said: “When you’re taking the country through difficult times and difficult decisions, you’ve got to take the country with you. That means permanently trying to make the argument that what you’re doing is fair and seen to be fair.”
The HMRC will be delivering a report on the tax on January 31, and this is expected to show that the tax has generated huge amounts of revenue despite earlier reports from the Treasury suggesting that the economic returns would be low.
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