Nick Clegg, Liberal Democrat leader, will on Monday use a speech in the City to call for the scrapping of tax loopholes that make London the accountancy equivalent of “a Swiss cheese” and to propose using the proceeds to cut corporation tax.

Mr Clegg will accuse the Treasury of devising a complex tax system for the City that encourages behaviour which “by any other name is tax avoidance”, claiming there is no evidence the loopholes are vital for London’s success as a financial centre. “If we create greater stability and transparency in the tax regime we can deliver cuts in the headline taxes that you pay,” he told the Financial Times.