Reeves to consider capital gains tax plan to help fix ‘broke Britain’

24 comments

1. CGT needs to at least be bought closer to income tax rates. It doesn’t need to go the full way, just a bit closer, and would raise billions.

2. This should be a no brainer. Executives are getting paid via shares and not cash after a certain threshold because they’d only be taxed 20% and not 45%.

3. Start by taxing british billionaires like Akshata Murty & Rishi Sunak

4. ”  And pension contributions are currently tax deductible, with officials having made the case for introducing a 30 per cent tax on contributions”

   When was this talked about?

   This seems the far bigger story?

5. Realistically all of our tax rates are set at reasonable or high levels.
   We need to start thinking more dynamically about generating revenue or cutting costs that isn’t “raise taxes” or “shut down essential services”. This is just a never ending circle of bullsh*t.

   I’m still in shock at how much has been spent on Asylum hotels.

6. There will be significant behaviour change which would impact the take from either the CGT change or the pension change.

   I own a business (built from scratch and now providing a livelihood for 75 odd people paying taxes in the UK) that on sale would have previously seen me benefit from entrepreneur’s relief, that was taken away during Sunak’s chancellorship and it’s less generous replacement meant that the tax I’ll pay on disposal when I retire in a few years time will be about 90% higher than under ER and whilst I’m grumpy about that I’ve come to terms with it. If CGT rates are bought in line with income tax rates my tax on retirement will more than double again. That may well be enough for me to be more than grumpy about it and it’s certainly enough for me to join the ranks of those that Reddit loves to hate and pay for some expensive tax accountant to help me mitigate the impact. And I think rich people should be taxed to pay for public services.
   Eta : I’m sure it will also change the behaviour of the next generation of entrepreneurs, and not in a positive way despite Reeves being a pro – growth chancellor.

   The article also mentions a 30% charge on pension contributions (presumably not on the part that would only have been taxed at 20% if not put in pension). There’s little/no detail but I wonder if that is in addition to the tax on pension withdrawal? If so it will massively change the incentives for using pensions as a savings vehicle for retirement. It’s big thing is that tax free income is left to grow before being taxed but it is then (largely) taxed on exit from the pension. If it’s taxed in the way in what’s the point of it?

7. Rather than raising taxes, why does it seem impossible to our politicians to make a few savings here and there?

8. I wonder how much can be gained from taxing second home ownership (not stamp duty/council tax) or landlords that own more than 1 property (excluding charities)

   It either generates money for the government or forces people to sell, freeing up property to home owners

9. Raising capital gains to the highest in the EU will be an interesting experiment. Hopefully she is prepared if it ends up losing money.

10. In my uneducated opinion, your tax rate for capital gains should be reflective of your total net worth – e.g. if your total investments are above 1 Million, you pay a flat 30% tax on any capital gains withdrawal, whether its £1 or £1M. If your assets are under £1M you pay 20% etc.

11. Didn’t Labour say they WOULDN’T increase taxes.
    But now they have found “such a mess” they HAVE to break their promises?

12. Why would anyone sell anything with capital gains tax at that rate? Or invest in building a business? Capital gains aren’t all “unearned” – there is considerable risk in starting a company for example. I also own a few shares and if I reach a target I might well sell and invest in something else. I would just hold at those rates. Not sure this will raise anything like what they claim.

    But landlords etc…….

13. Labour discussing taxes is scaring the shit out of everyone at the moment. I’m just eagerly awaiting what they consider to be ‘working people’ that they promised to not increase taxes on. £50k? £80k? £120k?!!!

14. Those calling for CGT to be balanced to Income Tax probably aren’t seeing the point of CGT in the first place. Capital Gains are taxed lower because it is supposed to be associated with an investment and investments carry risk (some more than others). Whereas tax is higher when applied on income where there is no risk. You work, you get paid. Whereas an investment may be realised on a long to very long timeline. This is also why capital losses can be set against gains and also losses carried forward to and set againsr subsequent years.

    If you push CGT too high then you risk people being deterred from investing in things (businesses, startups, warehouses etc) and so you cripple economic growth. Sure, your pitchfork wielding Redditor or guardian reader may be satisfied in the headline but the economy will suffer in the long term

    I’m all for CGT being pushed up on more illiquid assets like second homes, even wasting assets like classic cars etc, but you need to tread very carefully when you think that raising CGT across the whole spectrum won’t be without consequence, because it won’t be.

15. Hunt decreased capital gains tax by 4% in the march budget. It should be reversed.

16. How’s about you just stop pissing millions of quid up the wall each day, I’m sure that will help a bit.

17. CGT allowance was 12k a few years ago. Now down to £3k under the tories. Rate going up now as well. Sure feels like punching those in the middle to me.

18. Please don’t take it off the lower end and punish people with a share-save scheme at work.

    Go for the high end

19. Too few people are already paying far too much. There is far too much waste of money as well.

20. Liebour gonna lie. 

    They knew 100 percent about the money the country has before hand. They would have done audits etc been the opposition.  But yeah, they couldn’t come out and tell us that taxes will rise because they knew they would lose votes. So instead, they lied through their back teeth. Just you wait for tax, ni etc to go up soon

21. Already struggling to pay for my own place and my disabled mother’s flat. If these tax’s go in I will literally have no choice but to leave the country and take my business with me.

    Not all businesses earn 7 digits.

22. Fuel duty has been frozen for so long, it’s about time that got raised.

23. People who are screaming about broken promises, Labour said that they won’t raise VAT, income tax and something else.They didn’t say that they won’t increase taxes at all

24. They are considering? Do they not have a plan already?