Inequality · Taxing wealth · United Kingdom

What would taxing wealth more heavily actually do?

Proposals range from equalising capital gains and income tax rates to an annual tax on fortunes over £10 million. Each has a different modelled yield, a different group that pays, and a different main objection. Tax is one lever among several for the hardship described on the Inequality page.

Evidence last reviewed 3 October 2026

Six proposals, and what each would mean

Six ways of taxing wealth more heavily, each with the revenue that has been modelled for it, who would pay, and the objection its critics make. These are contested policy options, not settled answers, and the site takes no position on which is right.

Before comparing these options, see who owns Britain’s wealth, and what each group actually pays in tax today — including why no published data can show tax paid broken down by wealth band, and what the closest available evidence (income-based, not wealth-based) does and doesn’t support.

Annual tax on wealth above £10m

Widely quoted, unverified

A charge of 1–2% each year on individual net wealth above a £10m threshold, applying only to wealth above the line — someone with £11m pays on £1m, not £11m. Base would include property, pensions, investments and private business assets, less debts.

Advanced by: Most prominently argued by Gary Stevenson (Gary’s Economics), who proposes 2% above £10m. The Green Party proposes 1% above £10m and 2% above £1bn.

Modelled revenue

£24bn a year (as commonly quoted)

We could NOT verify the £24bn against its underlying modelling. It is usually attributed to Wealth Tax Commission work led by Arun Advani at Warwick, but the Commission’s published illustrations use different parameters — for example 0.6% above £2m raising about £10bn. The £24bn may well be a defensible extrapolation; we simply could not confirm it, and doubling a rate does not reliably double a yield once behaviour changes. Treat it as a campaign figure pending verification.

Who pays

Roughly 20,000–22,000 individuals, on the figures usually quoted.

Case for: Targets net wealth directly rather than the transactions or income that existing taxes reach, and shifts the balance of taxation from earnings towards assets.

Case against: Valuing private businesses, land and unlisted assets annually; asset-rich but cash-poor taxpayers; changes of tax residence; trusts and offshore structures; and the administrative cost of running a valuation exercise every year.

Gary’s Economics — the argument in his own words

Minimum tax on wealth above £100m

Independently modelled

A 2% minimum effective annual tax, applying only to the very largest fortunes, designed so that those already paying that much in other taxes pay nothing extra.

Advanced by: Proposed in academic analysis at King’s College London.

Modelled revenue

About £10bn a year

A different design from the £10m proposal and not additive to it. The narrower base means far fewer valuation disputes but also far fewer taxpayers, so the yield is more exposed to the decisions of a small number of households.

Who pays

Fewer than 1,000 households.

Case for: Concentrates on extreme wealth where the case for undertaxation is strongest, and the small number of taxpayers makes administration more tractable.

Case against: Highly mobile taxpayers; requires international coordination to be durable; and the yield depends heavily on a handful of individuals’ choices.

King’s College London analysis

One-off wealth levy

Independently modelled

A single charge on wealth above a threshold, assessed once on a past date and payable over several years, rather than an annual tax.

Advanced by: The Wealth Tax Commission’s own preferred option — it concluded a one-off tax is easier to justify and administer than an annual one, and that the economic case for an annual tax is much less straightforward.

Modelled revenue

Depends entirely on threshold and rate

Because it is assessed on a past date, there is far less scope to rearrange affairs to avoid it. That is its central advantage and also why it cannot be repeated — a "one-off" tax people expect to recur behaves like an annual one.

Who pays

A larger group than the annual proposals, depending on where the threshold is set.

Case for: Much harder to avoid, and does not require an annual valuation machine.

Case against: Politically difficult; raises money once; and credibility depends on it genuinely not recurring.

Wealth Tax Commission, final report

Property and land tax reform

Independently modelled

Replacing council tax, stamp duty and business rates with a proportional property tax or land value tax based on current values, rather than 1991 valuations.

Advanced by: Advanced by the tax lawyer Dan Neidle as a better alternative to an annual wealth tax, and by others across the political spectrum. Burnham has separately advocated a land value tax.

Modelled revenue

Design-dependent

Council tax in England is still based on 1991 property values, which is the clearest case of an existing tax failing to track wealth. Reform is revenue-neutral or revenue-raising depending on design.

Who pays

Property owners and landowners, weighted towards higher-value property.

Case for: Land cannot move or hide, so avoidance and emigration are far less of a problem than with a wealth tax.

Case against: Creates visible winners and losers by region; hits asset-rich, cash-poor households, particularly pensioners; and revaluation is politically painful.

Tax Policy Associates

Capital gains tax reform

Modelled, but disputed

Raising CGT rates towards income tax rates, so that income from selling assets is taxed comparably to income from work.

Advanced by: Liberal Democrat policy (20%, 40% and 45% bands, costed at £5.2bn a year by 2028-29 and hypothecated to the NHS). Green policy proposes full alignment with income tax. Also discussed within Labour.

Modelled revenue

£5.2bn (Lib Dem design); £16–20bn claimed for full alignment

The higher figures for full alignment are disputed. Raising the rate changes when people choose to realise gains, so a static calculation overstates the yield; the tax lawyer Dan Neidle has argued the £16bn figure is substantially wrong.

Who pays

People realising gains on assets — concentrated among higher-wealth households, but including business sales and second properties.

Case for: Uses an existing tax with existing administration; no new valuation regime required.

Case against: Taxpayers control the timing of disposals, so behavioural response is large and the yield uncertain.

Chartered Institute of Taxation, election analysis

Inheritance tax reform

Independently modelled

Narrowing reliefs — particularly business and agricultural property relief — and closing gifting routes.

Advanced by: Advanced by Dan Neidle among others as part of reforming existing taxes rather than creating new ones. Ed Davey has said the better-off should pay more inheritance tax.

Modelled revenue

Design-dependent

Reliefs are where most of the foregone revenue sits. IHT raises comparatively little relative to the wealth it nominally covers, largely because of the reliefs and gifting rules.

Who pays

Larger estates, at the point of death.

Case for: Existing administrative machinery, and taxes wealth at the point it transfers rather than annually.

Case against: Extensive avoidance through lifetime gifting and trusts; and reliefs exist partly to protect family farms and businesses from forced sale.

Institute for Government explainer on wealth taxes

The argument behind the £10m proposal

Gary Stevenson — A former Citibank trader turned campaigner, whose channel Gary’s Economics has made the case for an annual wealth tax to a large audience. His argument runs: Wealth concentrates → wealthy households buy more assets → asset prices rise faster than wages → people dependent on wages fall further behind → concentration compounds. His stated aim is not primarily to raise a sum to spend. It is to slow the concentration of wealth and shift taxation away from work and towards assets, which he argues would eventually allow taxes on earnings to fall.

The claim	What the evidence supports
A tax of this kind would raise substantial revenue	Independently modelled, though the specific £24bn figure is unverified
It would reduce measured post-tax wealth concentration	Almost by construction
It would slow asset accumulation at the top	Plausible; magnitude unquantified
It would make housing more affordable	Proposed mechanism; no reliable quantified effect
It would raise wages	Proposed mechanism; no reliable quantified effect
It would allow taxes on work to be cut	A political choice, not an automatic consequence

The main counter-argument: The tax lawyer Dan Neidle is the most prominent critic, challenging the proposal on valuation of private assets, tax residence and capital mobility, liquidity for asset-rich taxpayers, and international experience — most countries that tried annual wealth taxes have abandoned them. He argues reforming property tax, capital gains tax and inheritance tax would raise more with fewer problems.

This is a campaign proposal, not government policy. Stevenson has said publicly "I’m not advising Andy Burnham, but I’d love to" — he should not be described as a government adviser.

Gary’s Economics — the argument in his own words

What each party has actually done

The two-child benefit limit was abolished on 6 April 2026. The Child Poverty Strategy was published on 5 December 2025 with two headline metrics — but no statutory target. The widely quoted 550,000 figure is a modelled projection of the measures’ effect, which the government’s own impact paper describes as a comparison with and without them, not a commitment.

Labour (government)

Enacted in law

On child poverty: Abolished the two-child benefit limit from 6 April 2026, at £3.0bn in 2029/30 for Great Britain (the Act’s explanatory notes; Northern Ireland costed separately), benefiting about 560,000 families by an average £5,310. Free school meals extended to all Universal Credit households from September 2026. Published a ten-year Child Poverty Strategy in December 2025. Crucially, it contains NO statutory target — the widely quoted 550,000 figure is a modelled projection of the measures’ effect, which the government’s own impact publication describes as a comparison with and without the measures rather than a commitment.

On taxing wealth: Stated intention only. Labour’s 2024 manifesto pledged not to raise income tax, VAT or National Insurance rates this Parliament, and Budget 2025 (under Starmer) kept the headline rates; we have not confirmed that the Burnham government has restated the pledge, and its first Budget is due on 28 October 2026. Burnham has long argued the UK taxes work more heavily than wealth and has advocated a land value tax, but has not proposed a general wealth tax, and nothing is costed. Reports that he would align capital gains tax with income tax bands are contested and we could not verify them.

Our Children, Our Future: Tackling Child Poverty (published 5 December 2025)

Reform UK

Position reversed

On child poverty: Reversed its position. Farage supported scrapping the two-child limit in summer 2025, then in February 2026 proposed REINSTATING it to fund tax cuts for hospitality: "It is reducing the benefits bill in favour of encouraging private enterprise and jobs and wealth creation." Reform costed the hospitality package at £2.29bn in year one rising to £2.9bn by year four, funded by reinstating the limit — so unlike most positions on this page, the trade-off is explicit and costed.

On taxing wealth: No verified position established.

Reported February 2026

Conservative

No verified position found

On child poverty: No verified current position found on the two-child limit or the Child Poverty Strategy.

On taxing wealth: No verified position established.

Liberal Democrat

Costed policy

On child poverty: Opposed the two-child limit consistently since 2017 and supported the Bill removing it in February 2026. Called the December 2025 Child Poverty Strategy "just a collection of existing proposals, which is very light on any new measures", noting the government’s own numbers leave nearly four million children in poverty. Their only poverty target is not child-specific: end deep poverty within a decade. We found no statement after the limit was actually removed in April 2026 setting out what they want next.

On taxing wealth: Capital gains tax reform is costed: rates of 20%, 40% and 45% by gain size, claimed to raise £5.2bn a year by 2028-29 and hypothecated to the NHS. On an annual wealth tax the party has no policy at all — it appears in neither the manifesto, the policy index nor recent conference motions.

Liberal Democrat response to the Child Poverty Strategy, December 2025

Green

Costed policy

On child poverty: Backed abolition and says it is not enough: welcomed the removal but argued "far more action is needed to end the scandal of child poverty", with subsequent asks for universal free school meals, rent controls and universal winter energy support. Has no numeric child poverty target — the "250,000 children" figure is a claimed effect of its benefit measures, not a target. Notably, no Green MP spoke in the February 2026 Commons debate on removing the limit, and we found no Green response to the December 2025 Child Poverty Strategy.

On taxing wealth: The most specific wealth tax proposal of any party: 1% annually on individual assets above £10m and 2% above £1bn, which the party puts at around £15bn a year, plus aligning capital gains tax with income tax rates. These costings are contested — an independent review puts the wealth tax yield nearer £9bn, and the tax lawyer Dan Neidle notes no comparable tax exists anywhere raising that much from so few people.

Green Party measures on the affordability crisis, April 2026

SNP (Scottish Government)

Costed policy

On child poverty: Scotland has STATUTORY child poverty targets under the Child Poverty (Scotland) Act 2017 — the only part of the UK that does. It MISSED all four interim targets for 2023-24: relative child poverty was 22% against a target below 18%. The 2030 target of under 10% is independently projected to be missed, with the IFS, IPPR Scotland and the statutory Poverty and Inequality Commission all forecasting around 18%. The Scottish Child Payment is £28.20 a week, rising to £40 for under-ones from 2027-28. Scotland legislated its own two-child limit mitigation costing £155m, then withdrew it in December 2025 once the UK abolition was confirmed, reallocating £141m to other child poverty work.

On taxing wealth: Stated intention, constrained by devolution: "our scope for wealth taxation is severely limited, but we will continue to explore what is feasible". Firm devolved commitments are a mansion tax from 2028 (new council tax bands above £1m and £2m) and a private jet tax, neither costed in the manifesto. The manifesto says nothing about capital gains tax, which is reserved.

Bringing Hope, Building Futures: Tackling child poverty delivery plan 2026-2031

Plaid Cymru (Welsh Government)

Stated intention

On child poverty: Wales has NO child poverty targets — the 2024 strategy contains none, which is the central criticism from CPAG, Save the Children and the Children’s Commissioner for Wales. Plaid, now leading the Welsh Government, has committed to replacing it with a plan carrying "clear targets, benchmarks and milestones", restated as government policy in June 2026; those targets have not yet been published. Its Cynnal payment (£10 a week for children aged 0-6 in Universal Credit households) is a pilot with no cost attached in the manifesto. On the two-child limit it accepts the UK abolition and presses for the overall benefit cap to be lifted as well.

On taxing wealth: The 2026 Senedd manifesto says nothing about a wealth tax or capital gains tax. Plaid backed both at Westminster in 2024, but has not restated that in its devolved programme; both taxes are reserved.

Deputy First Minister statement on tackling poverty, June 2026

How we researched this: We verified Labour, Reform UK, SNP, Plaid Cymru, Liberal Democrat and Green positions against primary sources — manifestos, government publications and ministerial statements. For the Conservatives alone we could not establish a current, sourced position within this research pass. That is a limit of our research, not evidence that those parties have no position, and we will not characterise them until we can cite them. We also searched specifically for instances of any party dismissing or downplaying child poverty and found none for the SNP, Plaid Cymru, Liberal Democrats or Greens; Reform UK’s reinstatement of the two-child limit is a stated trade-off rather than a dismissal, and is quoted in its own words.

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