Former Labour leader Neil Kinnock today called on Sir Keir Starmer to impose a ‘wealth tax’ on Britons as ministers scramble to plug a hole in the public finances.
Lord Kinnock, who led Labour between 1983 and 1992, said a two per cent levy on assets worth more than £10million could be a ‘pathway’ out of the Government’s woes.
Chancellor Rachel Reeves is needing to find billions of pounds in revenue or savings in the wake of Labour’s recent U-turns on welfare cuts and winter fuel payments.
She has maintained she will stick to her strict fiscal rules on borrowing, while Labour pledged before last year’s general election not to hike taxes for ‘working people’.
Speaking to Sky News this morning, Lord Kinnock said there was now an appearance the Government was being ‘bogged down by their own imposed limitations’.
But he added there are ‘ways around that’, such as the introduction of a wealth tax when Ms Reeves presents her next Budget in the Autumn.
Lord Kinnock suggested such a levy would raise up to £11billion a year and be popular with a ‘great majority of the general public’.
But the Tories condemned it as ‘the worst thing to do’ as they warned of a fresh exodus of wealth-creators from Britain.
Former Labour leader Neil Kinnock called on Sir Keir Starmer to impose a ‘wealth tax’ on Britons as ministers scramble to plug a hole in the public finances
Chancellor Rachel Reeves is needing to find billions of pounds in revenue or savings in the wake of Labour’s recent U-turns on welfare cuts and winter fuel payments
As Sir Keir marks one year in office this weekend, Lord Kinnock admitted there was an appearance of ‘stiffness or stagnation’ about the Government after just 12 months.
‘It’s not actually the accurate picture, but the appearance is being given that they have been bogged down by their own imposed limitations,’ he said.
‘There are ways around that, ways out of it, pathways that I think people are willing to explore and actually, would commend themselves to the great majority of the general public.
New Corbyn-led party should be called ‘Farage Assistance Group, says Kinnock
A Jeremy Corbyn-led breakaway party to the left of Labour should be known as the ‘Farage assistance group’, former Labour leader Lord Neil Kinnock has suggested.
He told Sky News that any ‘splintering’ would ‘only be of assistance to the enemies of Labour’.
Asked how much of a threat he thought any new party could be, after Mr Corbyn suggested that discussions were under way, Lord Kinnock said: ‘I understand they’re, having a bit of difficulty over thinking of a name.
‘In a comradely way, I’d suggest one. It would be the Farage assistance group.’
He said that a ‘division’ in the ‘anti-right wing vote can only assist the parties of the right, the Conservatives, especially now under Mrs Badenoch and under Farage the Reform party.
‘So the splintering… offered by a new party of the left… can only be of assistance to the enemies of Labour, of the working-class – the people who have no means of sustaining themselves other than the sale of their labour by hand and by brain – and can only be of benefit to the egos of those who are running such a party.’
‘They include, for instance, asset taxes in a period in which – for the last 20-odd years in the UK, like quite a lot of other Western economies – earned incomes have stagnated in real terms while asset values have zoomed.
‘They’ve just gone through the roof.’
He added: ‘You wouldn’t have to touch assets of under £6million or £7million. So people’s houses would be secure obviously.
‘But even by going for an imposition of 2 per cent on asset values above £10million, say, which is very big fortune, the Government would be in a position to collect £10billion or £11 billion a year.
‘Now it’s not going to pay all the bills, but it does two things – or that kind of levy does two things.
‘One is to secure resources, which is very important. But the second thing it does is to say to the country, we are the government of equity.
‘And 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.
‘Now, I think that a gesture or a substantial gesture in the direction of equity fairness would make a big difference.’
But Tory shadow chancellor Sir Mel Stride condemned a tax on assets over £10milluion as ‘the worst thing to do’.
He said Labour’s tax hikes had already seen around 10,000 to 15,000 high net worth individuals leave Britain.
‘Some people, the socialists, might say ‘well, who cares about that?’, he added.
‘Well, the problem is that the amount of tax that those people have been paying requires about a third of a million people on average earnings to cover that lost tax that’s just gone straight out of the door.
‘So the last thing we want to be doing now is piling further taxes on the wealth creators.
‘We need to be, if anything, getting those taxes down, and empowering them to go out and do what they do best, which is creating jobs, and, you know, creating wealth and prosperity for our country.’
