Chancellor Rachel Reeves is under pressure to introduce a wealth tax as she seeks to balance the books in the Budget following U-turns on winter fuel and disability benefit cuts
Rachel Reeves said the Government has “got the balance right” on taxation as she comes under pressure to consider a wealth tax.
The Chancellor is battling to plug a hole in the public finances following recent Government U-turns on cuts to disability benefits and the winter fuel allowance.
Ms Reeves was grilled on fresh calls to introduce a levy on the wealthiest in the autumn Budget as she visited Scotland to tout investment in defence and energy. It comes after the Chancellor dismisses Donald Trump’s ‘con job’ wind turbine claim.
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On Thursday, Labour former shadow chancellor Anneliese Dodds on Thursday said the Treasury must look at the evidence on a wealth tax – which has been backed by party figures. Former Labour leader Lord Kinnock has suggested a 2% levy on assets of more than £10million could raise up to £11billion.
But Business Secretary Jonathan Reynolds last week rubbished the idea of a “magic wealth tax” and told supporters to “be serious”.
Ms Dodds, who resigned as International Development Minister in February over cuts to foreign aid, said ministers must have a “full and frank discussion” with the public about the “really big decisions” coming in the Budget in the autumn.
Today, Ms Reeves told the PA news agency: “In the Budget last year, we got rid of the non-domicile status in our tax system, so people who make Britain their home have to pay their taxes here.
“We introduced increased taxes on private jets, on second homes, and increased capital gains tax, so I think we’ve got the balance right in terms of how we tax those with the broadest shoulders, but any further decisions will be ones that are made at a budget in the normal way.”
Asked about Ms Dodds’ comments on a wealth tax, she said: “Decisions around tax are decisions that are made at a budget and we’ll make those decisions in the appropriate way, but the number-one priority of this Government is to grow the economy.
“And that means bringing more investment into Britain, creating more good jobs paying decent wages here in Britain.
“We’ve got to get the balance right on taxation because we want that investment, we want those jobs to come here.
“That’s why we’re reforming the planning system, secured three trade deals in the first year of this Labour Government, cutting back on unnecessary regulation, and reforming our pension system to unlock money for businesses to be able to invest here in the UK.”
It comes after Ms Dodds told Sky News’ Electoral Dysfunction that the Wealth Tax Commission “looked at the operation of lots of different wealth tax, they looked at all of that evidence and set out how it would be possible to deliver something like that in a UK context”.
She said: “I would hope that the Treasury is considering that kind of evidence as well as other changes that have been put forward.
“We’ve seen the deputy leader of the Labour Party (Angela Rayner), for example, put forward suggestions. I think it’s important for all of those to be considered now.”
Ms Dodds said a “longer-term approach” than the attempts to cut £5billion from the welfare bill, which have since been watered down,
She said: “An attempt was made to deal with a quite immediate problem, but I don’t think you can, particularly via cuts, actually deliver the kind of fiscal room that is necessary.”
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