‘Wealth tax plan targets middle class families who have diligently saved, not the truly wealthy’

People yet to reach retirement age and therefore without access to their savings pots would also have to look elsewhere to raise funds to meet the tax bill. Pensioners who fund their living costs through savings, farmers owning agricultural land and private business owners will all be stuck wondering how […]

People yet to reach retirement age and therefore without access to their savings pots would also have to look elsewhere to raise funds to meet the tax bill.

Pensioners who fund their living costs through savings, farmers owning agricultural land and private business owners will all be stuck wondering how they can pay when all their money is tied up in inaccessible savings, land and property. 

Borrowing may end up as one of the few options left, forcing them into debt. 

Wealth taxes, if ever used, should only be targeted at the truly wealthy, not a middle-earning family owning a semi-detached home, or those who have diligently saved into pensions and Isas over the years.

But today, the wealthy are more mobile than ever and these radical proposals would cause them to flee British shores, which would deal a massive blow to the overall tax take. Many would not pay at all.   

The scary thought is that a tax on our homes and savings once proposed as a temporary fix could become a permanent feature of our lives. 

After all, such a considerable amount of time and investment will be needed to make such a radical proposal a reality. And after they have raised all that money there is the inevitable question about what would replace it.

If the wealth tax is the answer, it must come with the simultaneous abolition or overhaul of capital gains tax and inheritance tax. 

But really the Government should be looking at existing taxes and how it can feasibly pull the levers to generate more through income levies, VAT and National Insurance. 

These already account for almost three quarters of the country’s total tax revenue. 

These emergency increases should be temporary and the additional revenue generated should be ring-fenced for supporting the NHS and those people and businesses worst affected by the pandemic.

Nimesh Shah is the chief executive of accountants Blick Rothenberg

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