07 Oct 2024
The Resolution Foundation has suggested that reforms to inheritance tax (IHT), capital gains tax (CGT) and national insurance (NI) could raise more than £20 billion a year.
The Foundation said that the reforms could also pass a 'triple tax test' of improving tax efficiency, making sure that tax rises fall on those with the broadest shoulders.
It said that Chancellor Rachel Reeves has 'greatly limited' her revenue raising options by pledging not to raise the main rates of income tax, corporation tax, VAT or NI.
According to the Resolution Foundation, CGT is 'ripe for reform' as rates are 'unjustifiably lower' compared to those on other forms of income.
Adam Corlett, Principal Economist at the Resolution Foundation, said:
'There is widespread speculation about what might be in the first Budget of the new Parliament, but overall tax rises are a dead cert and time-honoured tradition.
'Long overdue reforms to IHT, CGT and pension contribution reliefs would fit the bill and could raise over £20 billion if needed, while also making the tax system fairer and more consistent between different taxpayers.'
Internet link: Resolution Foundation