Bolt has refused to race in grand prix meetings in Britain since 2009 because of the country's draconian tax rules which mean that visiting overseas athletes have to pay tax on their earnings when they compete but also on part of their global income, including sponsorship deals.

But the exemption has been granted by George Osborne, the Chancellor of the Exchequer, after he had been approached by Sebastian Coe, the chairman of London 2012 and the British Olympic Association. 

The London meeting, switched from its traditional Crystal Palace home to the Olympic Stadium to mark the first anniversary of the Games on July 27, is expected to be a 80,000 sell-out and would have been damaged by the absence of athletes such as Bolt, who won three gold medals at London 2012, including in the 100 and 200 metres.

"The Government is determined to do everything possible to secure the Olympic legacy and I am delighted to grant this exemption," said Osborne.


A similar exemption was granted by the previous British Government for the Olympics and Paralympics and by Osborne for next year's Commonwealth Games in Glasgow.

It has also been adopted for the UEFA Champions League final at Wembley Stadium later this year. 

"It's good news for the Diamond League meeting and British sport in general," said Bolt's London-based agent Ricky Simms.

"The rules were discouraging a lot of the top stars from competing in the UK when they had options elsewhere.'

"I think it's about two weeks before the World Championships [in Moscow], which is quite late, but it's London and it's the Olympic Stadium again so it obviously has an attraction."

Osborne's exemption covers appearances fees, prize money and sponsorship income but it only covers non-resident athletes.

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