Rich ‘will avoid 50p tax rate’

Less than 40 per cent of the new "supertax" will be collected, Treasury officials admitted today.

In evidence before MPs, the Chancellor's advisers confirmed that large sums would be lost due to "behavioural effects" as the wealthy scrambled to avoid the charge. The new 50p income tax rate starts next April for all those earning more than £150,000 and has prompted claims that it will lead to an exodus of higher earners from London.

Mike Williams, the Treasury's director of personal tax, said 31 per cent of the total revenue yield would materialise.