'Top rate of tax will result in more emigration'

More wealthy people could be looking to emigrate in the near future if the government goes through with plans to introduce a new top rate of taxation.

Chancellor Alistair Darling is understood to be planning to introduce a new top 45 per cent rate of tax in this week's Budget, but experts have warned that the move could result in more people making international money transfers out of the UK.

According to predictions from the Institute of Fiscal Studies, the new tax rate would encourage more people to emigrate to other countries, where they would pay less tax, or even work less hard in the UK so that they earn less than the new threshold.

Many people may already be planning to make an international payment in an effort to escape the recession in the UK by emigrating, but the new tax level could provide them with even more of an incentive.

According to Expedia, eastern European countries such as Slovakia and Poland could provide a good location for someone looking to emigrate because they offer low costs of living and are good value for money.

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By Paul Jarvis