Taxing 'wealth boom' could raise £10bn, Reeves is told

Rachel Reeves could raise £10bn a year in wealth taxes as she looks to plug a massive hole in the public finances left by the Conservatives, according to a new report.

- ARCHIE MITCHELL

The left-leaning Resolution Foundation think tank says the chancellor could find the cash to fund Labour’s plans for power, including inflation-busting pay hikes for public sector workers, by levying taxes on unearned wealth. The report identifies Britain as a nation of “booming wealth” but “busted wealth taxes”, and sets out how taxing the richest could be the key to raising funds.

It comes ahead of a major speech by the chancellor in which she will blame Rishi Sunak’s government for Labour’s dire economic inheritance. She is expected to point to a series of unfunded spending commitments and identify a £20bn gap in current plans. Former chancellor Jeremy Hunt claims the move is a pretext to raise taxes and said the books have always been open to scrutiny.

The chancellor is expected to tell the House of Commons: “It is time to level with the public and tell them the truth. The previous government refused to take the difficult decisions. They covered up the true state of the public finances. And then they ran away. I will never do that.

“The British people voted for change and we will deliver that change. I will restore economic stability. I will never stand by and let this happen again. We will fix the foundations of our economy, so we can rebuild Britain and make every part of our country better off.”