John Healey rejects capital gains tax increase ahead of Budget
John Healey has rejected calls to raise capital gains tax at the Budget, amid concerns it could hamper economic growth, reports BritPanorama.
The tax applies to the profit made from selling off assets like a house or shares. Several prominent Labour voices, including Wes Streeting and Louise Haigh, spoke of raising capital gains tax over the summer, before Andy Burnham became Prime Minister. However, Healey has ruled out the move after warnings it could end up costing the government money if wealthy people leave the country or defer selling off assets, according to the Times.
Lord O’Neill of Gately, who has advised Burnham and worked on the Northern Powerhouse project, told the newspaper that “raising capital gains tax would send very much the wrong message to business.”
The biggest revenue-raising measure anticipated in the Budget is an increase in the rate banks pay on their profits, which has been widely reported. This increase is expected to fund cost-of-living support for households and businesses.
The Chancellor acknowledged that Britain finds itself in a “tough” position ahead of the Budget, and is reported to be downplaying the prospect of major revenue-raising measures in his statement on October 28.
Conservative leader Kemi Badenoch is expected to warn the Government to slash its spending plans and reduce borrowing at the Budget. In a speech on Tuesday, she will urge Burnham and his Chancellor to “live within our means,” highlighting the Tories’ proposed £70bn cuts to spending that include welfare and the civil service headcount.
Pre-Budget polling by Ipsos revealed that the majority of the public have mixed opinions about the Chancellor, with 67 per cent believing he is doing neither a good nor bad job. Furthermore, 65 per cent of those surveyed expect some form of tax rise in the upcoming Budget.
These developments come amid a landscape of financial uncertainty, suggesting that the government is weighing its options carefully before the crucial Budget presentation.
