Should there be a wealth tax? Take our ballot and have your say
Labour has so far repeatedly resisted increasing calls to raise levies on the super-wealthy as a way of boosting the Treasury’s coffers and helping to fund investment
Rachel Reeves has been urged to bring in a wealth tax(Image: PA)
Wes Streeting has called for a wealth tax arguing that the current system is not fair and punishes those in work.
The former Health Secretary called for capital gains tax to be equalised with income tax, a system he claims could raise £12billion a year.
Higher or additional rate taxpayers pay 24% on gains they make in the current financial year. Under Mr Streeting’s plans, that would be equalised with the income tax rate of 40% for higher rate taxpayers and 45% for additional rate taxpayers. The package would also close the loopholes he claimed people use to disguise income from work as capital gains, such as establishing personal service companies or taking pay in shares.
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Explaining his calls, Mr Streeting said: “A member of my family is a cleaner in Lancashire. She pays a higher tax rate on her salary than her landlord pays for the growing value of the home she lives in. She slogs her guts out, he puts in far less effort, yet the state rewards him more than her. And we wonder why people are angry.
“The system is penalising work. It’s not fair and it’s bad for our economy. We need a wealth tax that works. A pound made from simply owning assets should not be taxed less than a pound made from a hard day’s work.”
The IFS, Resolution Foundation, Tax Policy Associates’ Dan Neidle, and the Labour Growth Group have all pushed for taxing gains at the same rate as income, but only above a fair return on the original investment.
Labour has repeatedly resisted increasing calls to raise levies on the super-wealthy as a way of boosting the Treasury’s coffers and balancing the books. Rachel Reeves previously claimed the the Government had got the “balance right in terms how we tax those with the broadest shoulders”. Last year Dale Vince, one of Britain’s biggest taxpayers, called for a tax of 2% on assets of more than £10million that would generate £24billion a year and would impact only 20,000 people.
