The Treasury has estimated that the 50p rate of income tax will bring in an extra £12.6 billion over the next five years.
It claims that by 2015/16, the top rate of tax levied on individuals earning more than £150,000 a year will raise £3.2 billion more than if the rate had remained at 40%. Treasury data also shows that it will bring in £5.3 billion more than if the top rate had been set as 45%.
The data was calculated in November last year and revealed after Lord Ashcroft asked a question in parliament.
When the 50p rate was introduced, George Osborne claimed it would be a temporary measure. Since then he has said a final decision on the rate will be made after HMRC completes a review of its success. The review will be completed after next year’s self-assessment deadline in January.
Last week, 20 leading economists sent a letter to the Financial Times urging the government to get rid of the top tax rate, saying it was damaging UK economic growth. The letter claimed that the top rate made the UK a less competitive force on the global stage and foreign investors and highly skilled workers were less inclined to come to this country.
The Institute of Fiscal Studies previously said the 50p rate was a risk worth taking, but the group of economists says it is not only a tax on the wealthy but it is also harming the ordinary workers in lower tax bands.
The letter was signed by two former members of the Bank of England’s MPC as well as a number of university professors.
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