Axing the 50p tax should be among the "immediate actions" George Osborne takes to shore up Britain's economy against the fallout from the eurozone crisis, leading City figures have urged.

The Chancellor should "accelerate" plans to scrap the top rate of income tax to help attract entrepreneurs to the UK and increase the tax-free personal allowance by £1,000 more than planned next year, the group urged.

In a letter published in the Daily Telegraph, more than 30 business leaders also called for a hike in spending on infrastructure projects to help revive Britain's ailing economy.

"We would encourage an acceleration of the Government's commitments on two areas of tax policy: increasing the personal allowance and restoring 40% as the top rate of income tax," the letter says.

"An early removal of the temporary 50% tax rate would attract wealth generators to the UK and support the entrepreneurs we need to help us grow the economy and provide jobs.

"We await the conclusions of the HM Revenue and Customs evaluation of the sums raised by the 50% rate; however, we are confident that the cost to the Treasury, if any, in the short term will not be material and that the advantages over the life of this Parliament in terms of generally increased economic activity will more than outweigh any direct costs."

Senior Tories are keen to push ahead with plans to axe the levy on those who earn more than £150,000 but fear it will be politically explosive at a time of austerity. Coalition partners the Lib Dems are fiercely opposed to the plans.

The powerful group pushing for the move includes Sir Nigel Rudd, the chairman of airports operator BAA; Chris Grigg, the chief executive of British Land; Tony Pidgley, the chairman of Berkeley Group, the house-builder; Harvey McGrath, the chairman of Prudential; and Ian Powell, the chairman of PricewaterhouseCoopers.

It comes as Business Secretary Vince Cable said the Government was making contingency plans amid the "Armageddon narrative" of the potential collapse of the euro.

Europe's economic gloom deepened as Economic and Monetary Affairs Commissioner Olli Rehn warned: "Growth has stalled in Europe, and there is a risk of a new recession." Overall EU GDP (the combined national wealth of the 27 member states) is now projected to "stagnate" until well into 2012, with the commission downgrading its growth forecast of 1.8% next year to 0.5%.