Shadow Chancellor Rachel Reeves has explicitly ruled out the introduction of a wealth tax if Labour wins the next general election, as the party seeks to bolster its reputation for economic competence. In an interview with the Sunday Telegraph, Reeves stated that a Labour government would not impose a mansion tax, increase capital gains tax, or raise the top rate of income tax.
Reeves confirmed that Keir Starmer's leadership pledge to increase the 45p top rate of income tax is now off the table, a move widely anticipated after Starmer indicated in June he was no longer keen on the idea. She said, “We have no plans for a wealth tax. We don’t have any plans to increase taxes outside of what we’ve said. I don’t see the way to prosperity as being through taxation. I want to grow the economy.”
The comments mark a significant shift from Reeves' stance in September 2021, when she argued that “people who get their income through wealth should have to pay more.” Labour has since intensified efforts to court the corporate sector, with its annual business forum at the party conference this autumn oversubscribed by 75%, with 200 delegates attending and 150 on a waiting list.
A Labour source confirmed that Reeves' remarks also apply to any form of mansion tax, which the party had proposed under Ed Miliband before the 2015 election. Labour remains committed to scrapping non-dom tax status, closing a tax loophole for private equity fund managers, adding VAT to private school fees, and cracking down on tax avoidance.
The left-wing campaign group Momentum criticised the decision, stating, “Four people in this country have more wealth than 20 million Britons. Meanwhile, capital gains are taxed lower than income. This is a political choice to favour big business and the one per cent over ordinary people. Shameful.”
