Mayor would scrap Budget tax rate

Mr Johnson said "everyone" would pay for the country's debt

London's mayor Boris Johnson would advise a Tory government to scrap the 50% tax rate for earnings over £150,000 announced in the Budget, he said.

The Conservative mayor described the new rate as a "gimmick" that would make London less competitive.

Earlier Tory leader David Cameron would not commit to reverse the new rate.

But London minister Tony McNulty disagreed saying: "This is Budget for the future and a Budget to get London through the recession."

Chancellor Alistair Darling unveiled the new 50p tax rate for earnings over £150,000 on Wednesday.

He also announced that the UK would have to borrow a record £175bn.

This 'poke-the-rich-in-the-eye' stuff will raise only a tiny fraction of the huge sums that the chancellor and prime minister have accumulated in debt

Mayor Boris Johnson

Mr Johnson told BBC London that the Budget had taken a "1970s 'soak the rich' approach" that would harm London.

He said: "We have got to recognise that this 'poke-the-rich-in-the-eye' stuff will raise only a tiny fraction of the huge sums that the chancellor and prime minister have accumulated in debt.

"Everybody, I am afraid, is going to have to pay that off in much higher taxes all round."

The mayor added: "London is the motor of the UK economically. We need to send out a very positive signal about the enterprise culture we have in London."

Following the chancellor's Budget speech, David Cameron said Labour had left the economy in an "utter mess".

However he refused to commit to scrapping the new tax rate if the Tories won the next general election.

Cuts denied

Mr McNulty denied that the Budget would be followed by public spending cuts in the city.

"Some people have to pay in terms of taxation but at the moment we are not talking about severe cuts in London," he said.

"At the moment, in the middle of a recession, it is the last time to be making those sorts of cuts in the public services that Londoners really use."

Mr McNulty also denied that London got a "raw deal" from the Budget.

"The country is very clear that if London is not working, the rest of the country is not working - but we need to get that balance right," he said.

"I am a passionate believer and advocate for London but we need to see London in its context with the rest of the country."