Osborne faces calls to cut the top rate of tax

The Chancellor was this week facing a growing number of calls to cut the tax rate for the UK’s highest earners.

Several senior Conservative figures have urged George Osborne to reduce the top rate – which is paid by those who earn more than £150,000 a year – to 40p.

Mr Osborne had previously cut the tax rate to 45p four years ago, but has subsequently resisted calls for further reductions.

Sir Edward Leigh said: “The case is unanswerable that if we reduce the top rate back down to 40p, it will not only provide a wonderful fillip for entrepreneurs but also provide us with more revenue.”

Supporters said there was a strong case for the change after official figures, released earlier this week, suggested that the cut in 2012 had brought in more than £8billion in additional revenue.

Addressing Parliament, the Chancellor said that tax receipt statistics vindicated his decision at the time and proved that introducing “lower, more competitive taxes” was the best approach.

David Davis, a former Conservative leadership candidate, said: “I argued [in 2012] that Mr Osborne should have gone straight back down to 40p.

“These figures show once again that you can choose how to deal with the well-off…If you want extra taxes for schools and hospitals then you should choose a tax rate that they will pay.”

 

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Lee Davy-Martin

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