A cut in income-related taxes to put “more money in people’s pockets” is top of the pre-Budget wishlist for board-level executives at medium-sized firms.

A survey of 161 senior people by accountancy group KPMG shows that one in five put employee-focused tax cuts top of their list for Budget day this week.

The most desired measure, according to KPMG, was a cut in national insurance contributions, followed by a raising of the 40 per cent income tax threshold.

Third on the list was greater tax incentives for investment by businesses in machinery, premises and technology.

Chancellor George Osborne will deliver his Budget on Wednesday. He has already pledged to encourage long-term stimulus for businesses that will speed up the UK’s economic recovery.

“Like the chancellor, employers in mid-sized enterprises currently have very little room for manoeuvre and can’t afford to award large pay rises,” said David Bywater, tax partner for KPMG’s Middle Market Practice.

“There is a feeling that there is little benefit in awarding pay rises if 40 percent of it is eaten up in tax. A shift in the threshold of the lower 20 per cent income tax bracket could help employees, putting more of their wages into their pockets which in turn could boost the economy.”