Jonathan Reynolds has dismissed the prospect of a wealth tax as “daft”, amidst repeated warnings from the City that the policy would damage the UK economy.
In a podcast interview with GB News, the business secretary told those on the left of the Labour party: “Get serious!”
Reynolds insisted that much of Labour policy already constitutes taxes on the wealthy.
He said: “This Labour Government has increased taxes on wealth as opposed to income – the taxes on private jets, private schools, changes through inheritance tax, capital gains tax.”
The business secretary said that this kind of tax – alongside the existing taxes on assets and wealth – has no equivalent around the world: “Switzerland has a levy, but they don’t have capital gains or inheritance tax.
“There’s no kind of magic [tax]. We’re not going to do anything daft like that.
Reynolds added: “I say to people: ‘Be serious about this.’ The idea you can just levy everyone… What if your wealth was not in your bank account, [what if it was] in fine wine or art?”
To wealth tax or not to wealth tax?
Open speculation around a wealth tax was sparked by an intervention made by former Labour leader Lord Kinnock.
Kinnock criticised the government’s “lack of vision” and called for a two per cent tax on those with more than £6m.
Senior figures in the Labour Party – all the way up to Downing Street – have since publicly toyed with the idea of a wealth tax.
There was even another Kinnock in the mix – Stephen, the health minister – who told LBC that Rachel Reeves is looking “very carefully” at a wealth tax.
A Number 10 spokesperson said following Kinnock’s comments: “We have repeatedly said those with the broadest shoulders carry the greatest burden and the choices we have made reflect that.”
“Those with the broadest shoulders” has become a familiar refrain to media watchers as Labour spokespeople have grappled with the issue on air.