1 August 2025, 15:51
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The Treasury has “got the balance right” on tax, Rachel Reeves said, as she sidestepped calls from her predecessor Anneliese Dodds on imposing the tax.
It comes as the Chancellor faces increasing pressure to raise funds for the government ahead of the autumn budget, after several setbacks have left the Treasury in a precarious position.
Former shadow chancellor Anneliese Dodds said it was “important” for the Government to consider evidence set out by the Wealth Tax Commission.
Ms Dodds said she had considered implementing a wealth tax after she became shadow chancellor when Keir Starmer won the Labour Leadership in 2020, becoming the first woman to hold the position.
“I would hope the Treasury is considering that kind of evidence, as well as other changes that have been put forward,” Ms Dodds told Sky News.
Ms Dodds, who resigned as a Foreign Office minister in February over the Government’s decision to cut overseas aid to fund a defence spending boost, said the commission’s work “has changed the debate”.
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But Rachel Reeves said tax decisions would be announced at a future budget “in the appropriate way,” adding that the “number-one priority of this government is to grow the economy.”
“And that means bringing more investment into Britain, creating more good jobs paying decent wages here in Britain.
She told the PA news agency: “In the budget last year, we got rid of the non-domicile status in our tax system, so people who make Britain their home have to pay their taxes here.
“We introduced increased taxes on private jets, on second homes, and increased capital gains tax, so I think we’ve got the balance right in terms of how we tax those with the broadest shoulders, but any further decisions will be ones that are made at a budget in the normal way.”
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She added: “We’ve got to get the balance right on taxation because we want that investment, we want those jobs to come here.
“That’s why we’re reforming the planning system, secured three trade deals in the first year of this Labour Government, cutting back on unnecessary regulation, and reforming our pension system to unlock money for businesses to be able to invest here in the UK.”
Ms Dodds said this week that the Wealth Tax Commission “looked at the operation of lots of different wealth tax, they looked at all of that evidence and set out how it would be possible to deliver something like that in a UK context”.
The Oxford East MP added: “I would hope that the Treasury is considering that kind of evidence as well as other changes that have been put forward.
“We’ve seen the deputy leader of the Labour Party, for example, put forward suggestions. I think it’s important for all of those to be considered now.”
It comes after health minister Stephen Kinnock told LBC’s Shelagh Fogarty that the government was making sure that those with the broadest shoulders were paying the most tax, but that the chancellor would look at a wealth tax “very carefully”.
“Tax is, of course, something that the Chancellor will be looking at very carefully now and going into the budget in October,” he said.
“What I would say is that we’ve already taken steps to ensure that those with the broader shoulders bear the greatest burden. For example, what we’ve done on non-doms, on capital gains tax, the profits of big energy companies, taxing private jets.”
A number of people have advocated for a wealth tax recently, including former Labour leader and Stephen Kinnock’s father, Lord Kinnock, who advocated for an annual 2% tax on wealth above £10m.
Mr Kinnock said such a levy secures resources for the treasury while signalling to the country that Labour is “’the government of equity’”.
“This is a country which is very substantially fed up with the fact that whatever happens in the world, whatever happens in the UK, the same interests come out on top unscathed all the time while everybody else is paying more for getting services,” he told Sky News.
“Now, I think that a gesture or a substantial gesture in the direction of equity fairness would make a big difference.”
The group Patriotic Millionaires, which includes millionaires advocating for a wealth tax, said the levy would raise £24 billion a year for the UK- or around £460 million a week.
