Business secretary Vince Cable says lower tax rates for the super rich will not stop avoidance, in a key note speech at the Liberal Democrats.
Cable (pictured) said the idea that the wealthy were more likely to pay taxes if they were lowered was 'childish fantasy'.
He said: 'Some believe that if taxes on the wealthy are cut, new revenue will miraculously appear. I think their reasoning is this; all those British billionaires who demonstrate their patriotism by hiding from the tax man in Monaco or some Caribbean bolt-hole will rush back to pay more tax but at a lower rate. Pull the other one!'
Cable attacked suggestions that the 50p top rate of income on those earning £150,000 and over should be cut but relented that his party failed to reign in executive pay.
'It has not been possible for the party to get its own way on everything. I regret to say we did not secure tighter control on bank pay and bonuses. A bad message was sent; that unrestrained greed is acceptable.'
However, he added that the Independent Commission on Banking would help stop the 'dangerous nonsense' of high bonuses.
Cable used the speech to reaffirm his commitment to his mansion tax policy.
'When some critics attack our party policy of a tax on properties over £2 million by saying it is an attack on ordinary middle class homeowners, you wonder what part of the solar system they live in,' he said.
The business secretary also indicated he would target pension funds as investors in infrastructure projects.
'There are tens of billions of pounds of British savings in pension funds and insurance companies ready to invest in transport, energy, broadband and housing if regulators can ensure a reasonable, moderate return.'