Treasury slashes forecast for revenue from 50p tax rate
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City minister Lord Myners has revealed that the Treasury has “significantly reduced” its estimate of the revenue the new 50p rate of income tax will bring in.
Speaking in the House of Lords yesterday, Myners suggested that high earners will dodge the tax hit, saying that due to “behavioural consequences” of taxation change, the Government has revised down its expected revenue.
The Treasury had originally forecast that the 50 per cent tax rate for those earning more than £150,000 which is set to come in from April would bring in £1.13bn in revenue for 2010 and £2.5bn in 2011.
Lord Myners did not give a new estimate for expected revenue from the change, but said “we still believe it will be beneficial”.
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Readers' comments (2)
Chris Clifton | 2 Feb 2010 10:09 am
This is hardly a surprise and the treasury still does not seem to understand that individuals with the skill set to earn in excess of £150k also have the ability to find ways around the tax charge.
In the same way that employers will find ways around the new personal accounts, accountants will find ways of remunerating individuals without breaching the £150k threashold.
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Ian | 2 Feb 2010 10:26 am
Margret Thatcher worked out that the more penalistic the top rate of tax, the less money you got in.
This bunch of incompetents cant even fathom out that borrowing is deferred taxation & will eventually have to be paid back.
Not that they give a dam
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