The Government "shot itself in the foot" by reducing the top rate of income tax, according to millionaire Sir Martin Sorrell, who said he would back Nick Clegg's proposed wealth tax.
Saying that he "wouldn't be against" the Deputy Prime Minister's levy on high-earners, Mr Sorrell, chief executive of WPP, added "the Government's troubles started with the Budget" when it made the cut from 50 to 45 per cent. "From an entrepreneurial view it didn't make sense," he said. "If you want to improve entrepreneurial activity, reduce the rate of capital-gains tax. Don't mess about with income tax."
Mr Sorrell saw almost 60 per cent of WPP shareholders revolt against a pay deal in June that would have awarded him a 60 per cent pay increase to £6.8m.