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Tax hike for best paid 'will deter workers'

Wed 26 Nov 2008

The government's announcement it is to increase income tax for the highest earners will dissuade some workers from coming to the UK, PricewaterhouseCoopers (PwC) has warned.

The services firm has claimed the UK will look less attractive than other countries, which have lower taxes on workers' income.

The increase will put a "question mark on the UK's attractiveness as a place to work for resident and non-domiciled executives, "claimed Sean Drury, international mobility partner.

He said non-residents "will consider finding more attractive locations to work than the UK, such as Zurich, Dubai and Hong Kong or Singapore".

The income tax rise will hit those earning £150,000 or more and increase the tax they pay to 45 pence in the pound.

Announcing the rise, which is not effective till 2011, chancellor Alistair Darling said: "This higher rate of tax will only affect the top one per cent of incomes."

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