Brokers have warned the UK government that its revenues from stamp duty will continue to shrink after Gordon Brown, the Chancellor, again ignored calls before last week's Budget from the financial community to remove the tax on share trading.

Experts said as much as a third of UK equities channelled through the London Stock Exchange (LSE) are exempt from tax, because they are traded by intermediaries as a hedge against contracts for difference (CfDs). This number is likely to rise, they added.