'We are taxing wealth': Chief Treasury Secretary backs Streeting tax pledge vowing 'workable' plan to raise 8 billion by in 2030
Capital gains tax is a levy on the profits made after selling investments or assets, such as second homes or shares
The Chief Treasury Secretary has insisted that the existing government wealth tax will raise £8 billion by 2030, as Labour leadership hopeful Wes Streeting announces plans for a tax that will go further.
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Lucy Rigby told Nick Ferrari at Breakfast on LBC that the government is taxing wealth, but that any measures that go further than this need to be "workable".
Under Mr Streeting's newly announced wealth tax plans, he would see capital gains tax equalised with income tax, alongside measures to protect genuine entrepreneurs and long-term investment that contributes to economic growth.
Capital gains tax is a levy on the profits made after selling investments or assets, such as second homes or shares.
Research conducted by Patriotic Millionaires UK found that three-quarters of millionaires would be willing to pay more tax on their wealth to ensure public assets are properly funded.
Read more: Wes Streeting pledges to introduce wealth tax 'that works' if he wins future leadership contest
“We are taxing wealth in this country. We do tax wealth," Ms Rigby said.
"The measures that the Chancellor brought in in her first budget in 2024 put in place measures which are going to further tax wealth such that we're going to get 8 billion by 2030.
"When it comes to wealth taxes, the key thing is that they have to be workable. And in many countries where we've seen wealth taxes introduced, they haven't been workable.”
The annual amount of profit taxpayers can make before owing tax is £3,000, with anything above this taxed between 18 per cent and 24 per cent.
Mr Streeting’s proposal for capital gains tax rates would be aligned with the three bands of income tax rate: 20 per cent, 40 per cent for higher rate taxpayers and 45 per cent for additional rate taxpayers.
He vowed to do it alongside measures to protect real entrepreneurs – with lower capital gains tax rates for those taking risks building companies – and long-term investment to boost economic growth.
The package would also close the loopholes he said people use to disguise income from work as capital gains, such as establishing personal service companies or taking pay in shares.
The plan could raise up to £12 billion a year, he said, pointing to calculations by the Centre for the Analysis of Taxation.
“The system is penalising work. It’s not fair and it’s bad for our economy," Mr Streeting said.
"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.”