Rich Brits face fresh raid as No10 refuses to rule out ‘wealth tax’ to plug black hole
TAX hikes on Britain’s wealthiest could help fill the government’s financial black hole, Number 10 has indicated.
Rich Brits are facing a fresh tax raid as Downing Street refused to rule out a “wealth tax” at the autumn Budget.
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Wealthy individuals were seemingly warned to brace for hikes as they were told those with the “broadest shoulders should carry the greatest burden”, Number 10 said.
Any such move could be another blow to entrepreneurs and business chiefs, with 16,500 millionaires being driven out of the country due to a drop in economic confidence.
Business is also feeling the impact of April’s national insurance rise and the pending employment rights laws.
Downing Street refused to write the Budget ahead of time and pointed to Chancellor Rachel Reeves already ruling out a wealth tax.
The intervention comes after ex-Labour leader Lord Kinnock suggested the government was “willing to explore” bringing in a new wealth tax.
He said that a two per cent tax on assets worth more than £10million could pull about £10billion into Treasury coffers.
The Peer told Sky News: “The appearance has been given that they are bogged down by their own imposed limitations.
“There are ways around that, ways out of it, pathways that I think people are willing to explore and actually would commend themselves to the great majority of the general public.”
Chancellor looking for cash to fill black hole
By Jack Elsom, Political Editor
AFTER crucifying the Tories for creating a financial black hole, Rachel Reeves now faces one of her own.
The irony would almost be funny if the immediate prospect of tax rises were not so daunting.
U-turns on welfare and winter fuel – as well as possible downgraded economic forecasts – have left the Chancellor scrambling to stay within her “fiscal rules”.
She cannot borrow any more, and sluggish growth is not going to save her, so all the signs point to more tax rises.
It is a miserable thought for a country still reeling from the £40billion in hikes at the last Budget.
So where could Reeves look for cash?
A supposedly easy lever would be this so-called “wealth tax” that targets Britain’s richest.
Some suggestions have been to impose a 2% levy on assets over £10million.
While this would appease the left-wing Labour MPs who have been flexing their muscles of late, it could backfire spectacularly if our millionaires simply up sticks and move abroad.
The flight of capital is already a serious problem, and this wealth tax could even worsen the finances rather than bolster them.
Ms Reeves is facing a financial black hole of around £20billion that needs to be filled at the Budget, economists say.
Labour also made a pledge not to raise national insurance, income tax and VAT before they got into power as part of their manifesto.
She has vowed to stick to her iron-clad fiscal rules which means tax rises are all but inevitable.
Sir Keir has been warned that taxes will have to go up after the decision not to press ahead with welfare reforms that would bring in around £5billion.
