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David Cameron ditches plans to scrap 50p tax

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Prime Minister David Cameron has abandoned plans to scrap the 50p rate of income tax, according to The Daily Telegraph.

According to the paper, Cameron (pictured) and Chancellor George Osborne have concluded that abolishing the levy is politically impossible in the near future.

Cameron has emphasised the 50p rate should only be temporary. HMRC is due to publish a review outlining how much money the tax raises on January 31.

Reports suggest the review will show a surge in tax revenues totalling hundreds of millions of pounds from the first year the 50p rate was implemented.

The Telegraph says Osborne is likely to indicate in his March Budget that the decision to maintain the top rate of income tax until 2015 remains under review.

The tax is also expected to be subject to an annual review of its impact on enterprise.

Last year, a report by the Centre for Economics and Business Research found that the 50p higher rate of income tax would cost the Government up to £1bn a year as wealthier people would look to leave the UK to avoid the levy.

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Readers' comments (6)

  • I detect the hand of Nick Clegg!

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  • Income Tax itself was 'temporary' when it was first introduced by Pitt the Younger in 1798...

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  • I detect the hand of Nick Clegg too - great to see the tories being kept in check!

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  • When you take into account the lost allowances and NI the tax rate is nearer 63% Glegg and his cronies dont remember when we had high tax rates in the 70/80;s and when brought down the tax revenue went up. Clegg has Cameron under his little finger like the puppet master he his. Cameron will do anything Clegg says to stay prime minister

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  • Thanks to the FSA and Eurozone I can't see many IFA's making £150K this year.

    High taxes are good for IFA's because people wish to plan to avoid them.

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  • The spineless twerp Tories might as well have joined barmy Vince and the middle class guilt trip party. The 50p tax rate will do more harm than good. Bashing the City will likewise do more harm than good, as will the outrun from the crazy promise to ring fence the funding of the NHS. I despair.

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