In a further ramping up of the rhetoric ahead of George Osborne’s statement on Wednesday, the junior partners in the coalition are predicting that wealthy tax avoiders “should be quaking in their boots”.
It comes amid growing expectation that Deputy Prime Minister Nick Clegg has secured agreement to shut off a series of loopholes that allow the super-rich to avoid high rates of income tax.
A “tycoon tax” could be confirmed by Osborne this week, creating a minimum level at which income tax must be paid by residents in the UK. This would crack down on those high earners who use accountants to divert money into property and capital gains to secure lower rates.
It is also expected that the Chancellor will order a crackdown on stamp duty avoidance, where the rich sidestep the tax by channelling the purchase through offshore shell companies.
David Cameron, George Osborne, Clegg and Danny Alexander are expected to wait until tomorrow before finalising details of the Budget. Ministers are still to confirm plans to reduce the 50p tax rate on the 250,000 people in Britain who earn more than £150,000 a year.
Tory sources are fearful about the political impact of the measure at a time when child benefit is to be removed from households with one earner on more than £44,000.
As revealed in Scotland on Sunday last month, Osborne is also expected to grant the Lib Dem priority to increase the threshold at which people start to pay tax, with the target figure of £10,000 likely to be brought forward from 2015.