He warned: “Unlike normal, lots of investors will be thinking that the UK has had a bad Covid and it has got a pretty incompetent Government.”
He added: “We live in a much more mobile world. They’ll just disappear overseas. There are all sorts of places and it is much easier for entrepreneurs to go and base themselves there.
“We need to be really careful about this. Before you know it, successful people will disappear offshore – and guess what, they’ll take lots of jobs offshore. We are at a pivotal moment here and this Government needs to be reducing and reforming tax.”
A row over how to pay for the cost of coronavirus has been raging between Number 10 and the Treasury since the start of August, with Downing Street convinced that promoting growth is the best way to tackle the black hole in public finances.
A Cabinet minister told the Telegraph: “This is not the time to be increasing tax. The cost of coronavirus is a one-off, and to pay off the debt you have to grow the economy. We should be looking to cut corporation tax and other taxes to increase transactions.
“Putting taxes up now would be like acid rain falling on the green shoots of recovery.
“If you increase capital gains tax, for instance, people will just stop selling their assets, so you will get less tax revenue.”
Julian Jessop, an independent economist, said: “I personally think it is daft to be talking about this now. I know it has been said that 24 per cent would still be at or below the average from the Organisation for Economic Cooperation and Development, but so what? It’s still 5 per cent higher and moving in the wrong direction. The trend in corporation tax revenues has been down for a number of years.
He added: “Companies are relatively mobile and top executives are relatively mobile as well. Politically it seems attractive to make companies pay but in practice it is not the companies that pay, it’s the customers or the people who work for them, or their shareholders.
“It would backfire partly because it would drive companies overseas and but also because taxes aren’t paid by companies, they are paid by people – it is not pain free.”