A minister has slapped down Wes Streeting’s suggestion of a “wealth tax that works”.
Streeting resigned as the health secretary within Keir Starmer’s cabinet last week, accusing the prime minister of offering a “vacuum” instead of a vision for governing.
Starmer has so far resisted dozens of calls from his own MPs to resign and a leadership contest is yet to be triggered.
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But Streeting has claimed he would seek to enter any potential competition.
The backbencher now appears to have laid out parts of his policy agenda, telling the BBC’s Political Thinking podcast that he would introduce a wealth tax which could raise £12 billion a year.
He said his plan for a “wealth tax that works” includes reforms to capital gains tax, a levy on the profit made after selling an asset.
He wants to encourage investment by offering lower rates to “genuine” entrepreneurs.
Streeting claimed this would address the unfair system which is “penalising work”.
The annual tax-free allowance for the levy is £3,000 right now. Anything above this is taxed at rates depending on each individual’s income band.
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Higher or additional rate taxpayers must pay 24% on gains in the current financial year, but Streeting wants those rates to mirror income tax bands (20%, 40% and 45%).
The ex-health secretary – usually seen to be on the right of the Labour Party – suggested closing loopholes which allow people to conceal income from work as capital gains.
This is a clear appeal to those on the left of the party.
But, it is very different to the Green Party’s proposal of an annual tax of 1% on assets above £10 million and 2% on assets above £1 billion.
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Even so, chief secretary to the Treasury Lucy Rigby rejected Streeting’s idea outright.
She told BBC Radio 4′s Today programme: “We already tax wealth in this country.
“The chancellor introduced a host of measures in her first budget, and then further measures in the last budget as well, that try and make sure that tax is as progressive and fair as possible.”
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