Andy Burnham has been urged to introduce a two per cent wealth tax on every £1 million of an individual's wealth, according to a policy report from the Labour Party pressure group Compass. The report, seen by The Independent, outlines 100 policies for the new prime minister's first 100 days in office.
The Compass policy document suggests multiple types of wealth tax, including a 2 per cent tax on every £1 million. It states: “Our country’s economy is in ruins with underfunded public services and indebted councils. A wealth tax of 2 per cent on every £1m of an individual’s wealth would transform the country”.
How many households would be affected?
In total, there are an estimated 673,143 homes valued at £1 million or more across the country, according to property research from estate agent Savills. London contains approximately 340,620 homes valued at £1 million or more, representing just over half of the national total.
Mr Burnham has hinted that a wealth tax could be part of his 10-year plan for the UK, though his close advisers have focused on a rise in the threshold of capital gains tax to match income tax to raise extra revenue.
Burnham's stance on fairness
Speaking to footballer-turned-podcaster Gary Lineker previously, Mr Burnham said: “I do believe we need a greater sense of fairness and people feeling things are being done in the right way, but at the same time I don’t want to be perceived as someone who is coming in with grudges and agendas and demonise one group.”
Gabriel Zucman, a professor of economics at the Paris School of Economics, and Ben Tippet, a lecturer in economics and wealth inequality at King’s College London, have also advocated for a wealth tax in a new report.
Expert support for a focused tax
Their report said: “The objective is not to create a broad-based wealth tax affecting millions of households but rather a focused tax on extreme wealth that can make billionaires pay the same tax rates as the rest, raise meaningful revenues and dampen runaway inequality.”
Zucman, who is also an economics professor at the University of California, Berkeley and is known as “the architect of the global wealth-tax movement”, said: “Given the small numbers of households that would be taxed, the UK government could implement this quickly.”
Tippet said: “The report shows that a well-designed minimum tax on the very wealthiest households is a realistic, targeted reform that would make the UK’s tax system fairer while raising substantial revenues.”
