The chancellor of the Exchequer, George Osborne, has announced Capital Gains Tax (CGT) is to be increased to 28% for high-rate tax payers, from midnight today, but will remain at 18% for low and middle earners paying the basic tax rate.

Speaking this afternoon in his Emergency Budget speech, Osborne said: Capital gains tax means the richest people pay less capital gains tax than those who clean for them.

Commenting on the announcement, Clive Fathers, partner at head of the employment solutions team at Grant Thornton, was not surprised. He said: I suspected the top rate of CGT would be significantly higher than 20%.

This is a political move. The money it will raise is negligible, but Osborne has done this as something for the Liberal Democrats.

James Biggs, corporate pensions specialist at Lorica Consulting, added: I think this is a breath of fresh air. Something needed to be done to ensure the tax system is fair. There needs to be less disparity between capital gains tax and the highest rate of income tax [which is 50% for any earnings higher than £150,000].