Wes Streeting has called for a massive hike in Capital Gains Tax as part of his pitch for the leadership. Or the highest office possible under Burnham…
Streeting complained to the BBC’s Political Thinking podcast about the tax system and proposed a “wealth tax that works“:
“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. We can do it in a way that is pro-growth, pro-entrepreneur and pro-work.”
The former Health Secretary, who gave his resignation speech in the Commons yesterday, has misunderstood capital gains, which are not income. International evidence (and UK evidence) shows that when CGT rates go up revenues go down…
Streeting’s proposal is for capital gains tax rates to match the three bands of income tax – 20%, 40%, 45%. “Under the proposal, a person’s capital gains tax band would be calculated by adding up their income and profits from assets.” If the tax rate was 40%, then an increase from 24% to 40% would be a 66.7% increase and an increase from 24% to 45% would be an 87.5% increase. Streeting relies on a paper by the architect of the now-discredited Farm Tax which claims £14 billion could be raised…
HMRC’s own calculations show that increasing higher Capital Gains Tax rate by 10 percentage points (a 21% increase in the rate) would actually reduce revenue by £3.5 billion. A 5% increase would reduce it by £870 million. Increasing the lower rate also reduces revenues – the relatively modest CGT rises that have already taken place have resulted in significant lost revenue…
The latest HMRC stats from 2023-4 shows that the average gain per CGT taxpayer was about £174,000 in a year. That means the 45% tax rate in the majority of cases, which according to HMRC forecasts predicts a £7 billion loss in tax revenue…
With three exceptions European countries tax capital gains at substantially lower levels than income. Those three all tax them at between 20% and 10%…
Streeting has proposed this idea before in a pamphlet which seems to represent the last time he thought about policy. The ‘Labour Growth Group’ has mostly copied Farm Tax creator Arun Advani’s proposals in their own paper. Pop that in the bin…
Guido also called this at the beginning of the month. Tomorrow’s news, today…
There are growing demands for Angela Rayner to publish the documentary evidence from HMRC that details how she did not act “carelessly” and had no penalty to pay. Because it doesn’t make sense…
Tax experts led by Labour’s Dan Neidle yesterday challenged the supposed ‘exoneration.’ If it really exists…
Neidle subsequently spoke to tax barrister Graham Aaronson KC, who said Rayner could challenge the extra tax bill in court – a proposition she refused. He put forward her side but Neidle concluded: “The position remains: we can’t assess whether HMRC acted correctly. If Ms Rayner wants people to accept that she acted properly, and HMRC’s decision was correct, then she should release the evidence that led HMRC to conclude she was not careless.”
Eyebrows have also been raised after Aaronson sent a two-page legal letter requesting that HMRC close the matter “as soon as possible,” after which she supposedly received a decision within 24 hours. Barking orders to the taxman doesn’t usually work for punters…
Guido hears that when Rayner was previously “exonerated” – about which concerns were also raised – just as the general election was called in 2024, the journalists with whom she did media did not see any proof. It was all based on trust…
The phantom ‘tax advice’ she received earlier in that scandal was never and has never subsequently revealed either. Even Starmer did not see it. Now once again no evidence has been published, and the media gave Rayner gasping interviews for her grand return to the fray on Thursday…
Basically what people must conclude from this HMRC decision, if it indeed is an HMRC decision, is that if you’re confused about how much tax to pay, you shouldn’t seek professional advice. You should just pay the lowest amount and hope that it all works out OK, knowing that if it doesn’t then you won’t have to pay any penalty. Unless Rayner publishes evidence to the contrary…
HMRC data published today shows 864,000 self-employed workers and landlords will be forced into quarterly digital tax reporting when ‘Making Tax Digital for Income Tax’ goes live in April. The construction sector is the worst affected, with 251,000 businesses caught by the new rules. That is nearly a third of the total. One-man band plumbers, electricians, and bricklayers who are now required to file four times a year instead of one…
London accounts for the single biggest regional share at 167,000, boosted by 35,000 landlords-only, nearly three times the number in any other region. Across the country 118,000 people whose only qualifying income is from property will be pulled into the pointless regime for the first time.
The mandate applies to anyone with combined self-employment and property income above £50,000. Each will need compatible accounting software to submit quarterly updates to the tax man, so that’s yet another new recurring cost on top of the extra tedious admin. At least the accountants will be happy. And good luck getting on the phone to HMRC when this system inevitably hits the skids…
Angela Rayner could now face yet another tax bill over the legal advice Labour paid for to examine her personal finances before her resignation last September. It’s a day ending in Y, so Angela Rayner’s tax affairs are back in the headlines…
The Times has revealed that Labour used party funds to hire Jonathan Peacock KC, a leading tax barrister, to examine whether Rayner had underpaid stamp duty on her £700,000 flat in Hove. Ethics adviser Sir Laurie Magnus wrote at the time that the advice she sought “covered her personal position in relation to council tax, stamp duty land tax, capital gains tax and inheritance tax”. Here we go again…
Under the Income Tax (Earnings and Pensions) Act 2003, employer-funded legal costs are usually only tax-exempt where they relate to liabilities or proceedings connected with the employee’s duties or office. Rayner’s advice concerned her personal property arrangements and had no connection to her parliamentary duties or her role within the party. If the payment is treated as a benefit provided by reason of her office as Deputy Leader of the party, HMRC would likely view that as a taxable benefit in kind on which she would owe income tax. This all happened within the current tax year, so if there’s tax owed, it wouldn’t need to be reported and paid yet. When the time comes, will the former ‘DPM’ open her purse? She should be used to this by now…
There are millions of taxpayers out there who would appreciate someone else picking up their accountancy bill without that being taxable. Sadly, that’s not how it works in the real world…
Brits are the most supportive of reducing both taxation and state spending since the mid 1980s. The National Centre for Social Research has today published its latest report into British social attitudes which shows a marked change in attitudes to tax and spend since 2020. Watch the purple line, which represents ‘taxes and spending should be reduced’…
The NCSR explains:
“In our latest survey, just 36% say the government should increase taxes and spend more, down four points on 2024, and 19 points below the figure recorded in the 2022 survey.
Not since 2013 has the proportion wanting more taxes and spending been so low. But even more strikingly, an all-time high of 19% now say that taxes and spending should be reduced, up four points on 2024, and more than double the proportion in 2022 (8%).
Indeed, until the last three years, the proportion saying that taxes and spending should be reduced had never even been as high as 10%.”
Game on…
The 29 councils that have had their local elections cancelled this year by Labour are set to raise council tax by £121 million next year, according to research by the TaxPayers’ Alliance. Without a mandate to do so…
Peterborough is set to increase tax the most – by nearly £5.4 million. Meanwhile five councils that have cancelled their elections for a second year running are forecast to hike tax by £105.4 million in 2026-27 compared with 2025-26. Council tax across all local authorities is expected to rise by £1 billion next year. Elliot Keck of the TaxPayers’ Alliance, said:
“Any council cancelling their elections and still considering raising council tax should hang their heads in shame. It represents a serious breach of democratic norms to increase tax without a mandate to do so from the voters, adding insult to injury given these delays are patently unnecessary.”
No taxation without representation…
The TaxPayers’ Alliance has written to Housing Secretary Steve Reed. Keck says:
“It is a core principle of democratic governance that taxation should only be levied with the consent of the people. As far back as the Bill of Rights it was ruled that levying money for the Crown without the consent of Parliament is illegal.
The same principle should apply now. For all intents and purposes, councils with delayed elections are not democratically elected. Just as we would not consider a foreign government democratic once it exceeded its term limit, regardless of how it initially came to power, nor should the British government view councils exceeding their term limits as democratically elected. Local taxpayers certainly won’t.
As a result, we are asking on behalf of the taxpayers of these areas that you bring legislation urgently to parliament to strip these local authorities of the power to increase local tax rates. This would not impact their current tax raising powers, which should be sufficient to last for the coming financial year given successive years of council tax increases.”
People have fought wars over this – just saying…
Read the full letter below:
Continue reading “Councils Cancelling Elections Set to Raise Tax by £121 Million”
Former leader of the SNP in Westminster Ian Blackford told Times Radio why he believes Nicola Sturgeon’s claim that she spent no time in the kitchen and therefore didn’t see any of her husband’s purchases:
“She doesn’t have a passion for cooking.”
