SMEs urge chancellor to scrap 50% tax rate

The leaders of many small and medium-size businesses have called on the Chancellor of the Exchequer to get rid of the 50 percent tax rate that is charged for the highest earners in the UK.

An open letter has been written by these people address to George Osborne and it’s been published in The Telegraph. The business owners have said that the taxes are a politically motivated device, and is harmful in a time where the economy is in a bad state. The letter states that the 50 percent tax rate makes it awkward for people who are creating a great deal of wealth.

The 50 percent tax rate currently applies to any income the people earn over £150,000. Furthermore, if you consider the National Insurance contributions that people have to make, the tax rate effectively reaches 58 percent.

The letter states, “The poorest in our society should be helped by the wealthiest, but the system is already significantly disproportionate. The top one percent of earners in the country are responsible for providing nearly 25 percent of all taxes from income.” The Chancellor will soon be receiving the results of a study which looks at what effect the 50 percent tax has had on the economy