High-earners tell 黑洞社区 improving industry productivity more important than hiking their pay packets

Top construction bosses have told 黑洞社区 the government was right to abandon its plan to abolish the 45p top tax rate but questioned why it was introduced in the first place 鈥� with one saying it was a 鈥渓udicrous thing to do鈥�.

黑洞社区 contacted several senior industry figures 鈥� all of whom earn 拢150,000 or more and so would have been beneficiaries of the plan to lower the top rate of tax by 5p 鈥� to ask for their views on the proposal which was jettisoned yesterday by chancellor Kwasi Kwarteng after a storm of criticism.

Speaking on condition of anonymity, one said: 鈥淭heir growth agenda has been overshadowed by a crazy thing. I don鈥檛 know anyone who earns good money who thinks it was a good idea. It was a ludicrous thing to do.鈥�

kwasi

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Kwasi Kwarteng on his way to deliver his mini-budget last month in which he said the top rate of income tax would be cut from 45p to 40p

Another added: 鈥淲hen you have railway workers and postal workers going on strike, nurses who are underpaid, to then take 5p off the well-off was totally the wrong thing to do. The growth plan is positive but it鈥檚 been totally overshadowed by this [row].鈥�

And a third said he suspected the move was to try and attract business people from US, where the top rate of tax is 37%, to set up base in the UK.

鈥淚 haven鈥檛 heard any of my peers saying they want this tax change. We need to improve productivity, yes, but this was totally the wrong to do. There is a growing inequality in society and this would have done nothing to help close that gap. We have to grow the economy, improve productivity and improve the lives of people.鈥�

The cut would have meant just 拢2bn less for the Treasury and the director of the Institute for Fiscal Studies, Paul Johnson, said: 鈥淔rom a fiscal point of view [it鈥檚] important to remember [the] cut to [the] 45p rate was just about smallest part of the mini budget. What was a 拢45bn tax cutting package is now a 拢43bn package.鈥�

Announcing the U-turn yesterday morning, Kwarteng said the cut in the top rate of tax had become a 鈥渄istraction鈥� from the policies he announced in his mini-budget last month.

He later told the Tory party conference yesterday afternoon the plan had caused 鈥渁 little turbulence鈥� and added: 鈥淲hat a day, it has been tough but we need to focus on the job in hand.鈥�

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