Up to 160 Conservative MPs want to cut the top rate of income tax to 40 per cent

James Nickerson
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George Osborne is set to give his first truly Conservative budget (Source: Getty)

Senior Conservatives have said up to 160 MPs want the top rate of income tax taken down to 40p in the next budget, due on 8 July.

Read More: Think tank IFS says Labour cannot bank on 50p tax rate to bring in more money

This mounts pressure on George Osborne ahead of his first truly Conservative Budget, having delivered previous ones while in coalition with the Liberal Democrats.

Influential backbencher Steve Baker, and Liam Fox, the former cabinet minister, are the latest names publicly calling on Osborne to cut the top rate of tax – despite concerns that a tax cut to the wealthy could undermine Cameron’s one nation message in a time of austerity.

Fox, the former defence secretary who held the post under Mr Cameron, called on Osborne to ignore warnings the move could hurt how the party is perceived.

The issue is likely to be at the forefront of debate over the next ten days. In 2012, when the chancellor cut the top rate to 45p, his party was attacked and the policy helped push Labour into a lead in the polls.

Nigel Lawson wants a lower top rate of tax (Source: Getty)

On the financial side, just last week Lord Nigel Lawson, the former chancellor under Margaret Thatcher, publicly called for the change, arguing it would boost revenue for the Treasury.

"I would strongly support this: It would significantly enhance the attractiveness of the UK as a place to do business, at no cost in terms of lost revenue," he told the Financial Times.

He and other advocates of lowering the tax rate pointed to Treasury analysis showing the move would increase the money taken by government, and point out even Gordon Brown kept the top rate tax at 40p during the majority of the New Labour years.

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