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Top rate tax to remain

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The UK’s new top rate tax of 50 per cent will remain for the foreseeable future, the Business Secretary, Vince Cable has said.

The highest marginal tax rate of 50 per cent on those earning £150,000 or more has been in place since 6 April.

Taxpayers who are above the earnings threshold for the top 50p rate also receive a lower relief rate, tapering to 20 per cent, on their pension contributions.

Addressing the Liberal Democrat conference, Dr Cable described the rate as “an important symbolic measure”.

He added: “I don’t think any of the major parties are looking to change that. When the coalition government came in, both the Conservatives and ourselves accepted that was the right thing to do in a national emergency. There is no discussion about removing it.”

The minister continued: “I think the key message we need to send is about fairness. The fact is, lots of people are suffering a great deal because of the banking collapse and the recession that followed.

“We’ve now got to do painful measures to deal with the enormous deficit. What we want to do is to make sure that people at the bottom end of the scale are lifted out of tax and that people at the top end, who have done well out of the boom period, pay their share.”