'Vindictive' tax will drive brightest entrepreneurs abroad

Date: 1st July 2009

One of London's most successful entrepreneurs has slammed the government's 50 per cent tax rate, suggesting it will only force the nation's money-makers abroad.

In an article for the Telegraph, Peter Hargreaves insisted the government would be better off cutting public spending than upping tax for the highest bracket of earners.

Should people be faced with losing half of their income, they are quite likely to relocate to one of a number of the world's other finance centres, much to the detriment of the UK capital.

If this happens, the UK will suffer "long-term damage" he warns.

He said: "The consequences for the economy are dire at all levels, especially in the City of London.

"The City attracts bright young people from the entire globe…[but] these people are quite happy to work in New York, Zurich, Singapore or any major financial centre."

Mr Hargreaves suggested that the government's decision over the tax was crucial for the future of the economy.

he commented: "The decision is simple: raise taxes and see the end of prosperity, or reduce taxes and enjoy the return to prosperity."

Mr Hargreaves started his business, Hargreaves Lansdown, in a spare bedroom, before floating it on the stock market for £800 million.