Chancellor George Osborne has slashed the top rate of tax for the biggest earners, claiming that the controversial 50% rate was damaging the economy.
He pressed ahead with the move - unpopular with some Liberal Democrats - after revealing that an official report by the taxman had found it was raising “next to nothing”.
He also reduced proposed cuts to child benefits paid to the better off.
But he increased the threshold at which everyone starts paying tax to £9,205, claiming millions of working people would be £220 a year better off as a result.
The cut in the top rate of income tax to 45p in the pound for all income over £150,000 from April 2013 was countered with a hike in stamp duty on homes worth over £2 million from 5% to 7%.
Responding to the budget the MP for Portsmouth South Mike Hancock said: ‘I’m disappointed.
‘Disappointed he didn’t do more to get people into work. Disappointed that pensioners are going to get hit.
‘I’m pleased that people will be taken out of paying income tax altogether. It’s a real bonus to see that nearly a million normal people wont be paying tax next year. But I’m cheesed off about the top rate tax cut.’
Portsmouth Chamber of Commerce director Maureen Frost said she thought it was ‘a good budget for business’.
She said: ‘We like the fact that there seems to be a focus on bringing down inflation to two per cent, and the reduction of corporation tax with a promise to reduce it more within two years is welcome.
‘And something we have been campaigning about is improving broadband speeds, particularly in rural areas.’
She added that they would need to look at the announcements in more detail before passing final judgement.