UK Chancellor Rules Out Raising Capital Gains Tax to Match Income Tax Rates, Says FT
UK Chancellor John Healey rejects calls to align capital gains tax with income tax, as fiscal pressures mount. New policy details emerge.
POLICY WIRE — London, United Kingdom — The UK government has confirmed that Chancellor John Healey will not increase capital gains tax to match income tax rates, according to reports from the Financial Times. This decision comes amid growing pressure on public finances and debates over how to address budget shortfalls.
The Resolution Foundation, a leading economic think tank, has criticized the approach of delaying tough fiscal decisions, urging the government to raise £8 billion in taxes to restore its depleted fiscal buffer. The foundation warned that the budget shortfall has dropped from £24 billion to £12 billion due to ongoing conflicts in the Middle East, and called for targeted support for those most affected by rising living costs.
James Smith, chief economist at the Resolution Foundation, emphasized the need for immediate action, stating that postponing difficult choices would only worsen long-term challenges. He also highlighted the importance of addressing both immediate cost-of-living pressures and rebuilding fiscal headroom through tax reforms and spending controls. Meanwhile, the Treasury has ruled out increasing capital gains tax to the same level as income tax, despite support from some Labour figures.
Reporting by Policy-Wire (PW)
