London mayor Boris Johnson has warned that up to 9,000 bankers could leave London thanks to the recently imposed tax raid on their bonuses.

A new tax rule states that there will be a 50% tax on bonuses over £25,000 – a tax which wil initially only be for a year. The Conservatives have said that if they win the General Election they will scrap this new tax.

Although the new tax is predicted to bring in around £5 billion, Johnson believes that it could have a massive detrimental effect on the City and could undermine London’s status as one of the World’s financial capitals.

High earning bankers face a double whammy as they will also be subject to a new 50% tax earnings over £150,000.

Johnson has written to John McFall, chairman of the Treasury Select Committee, calling for the influential body to launch an urgent inquiry.

“One bank told my office that 1,600 of its staff had asked since the Pre-Budget Report for help in relocating from London,” his letter reads.

“Even if institutions decide not to move out of London entirely, many will choose to relocate key functions and personnel in other places around the world perceived to be more welcoming.”

If Johnson’s predictions are correct and 9,000 bankers do leave, it is estimated that the treasury will lose around £1.2 billion in tax and National Insurance contributions.

Many analysts are backing the mayor’s predictions and have called the new tax regime ‘ill-thought out’ with dramatic long-term negative implications possible.

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