Wes Streeting pledges ‘wealth tax that works’

In his first major proposal, Streeting is suggesting reforms to capital gains tax, which is a levy on the profit made after selling an asset, such as property.

A report by Centre for the Analysis of Taxation, external in 2024 estimated reforming capital gains tax could raise £14bn.

The annual tax-free allowance for the levy is £3,000 and anything above this is taxed at rates that depend on a person’s income band.

For example, higher or additional rate taxpayers have to pay 24% on gains in the current financial year.

Streeting is suggesting capital gains tax rates should mirror the three bands of income tax – 20%, 40%, 45%.

Under the proposal, a person’s capital gains tax band would be calculated by adding up their income and profits from assets.

Streeting is also proposing closing loopholes that allow people to disguise income from work as capital gains.

On top of this, lower rates of capital gains tax would be offered to entrepreneurs who take risks building companies.

The policy is different to the wealth tax proposed by the Green Party of England and Wales.

The Green Party has suggested an annual tax of 1% on assets above £10m and 2% on assets above £1bn.

In the Political Thinking interview, Streeting was also asked about his position on Brexit, which was a focal point of a speech he gave last weekend.

In the speech, he said leaving the European Union following the 2016 referendum had been a “catastrophic mistake” and the UK should “one day” rejoin the bloc.

But Streeting told the BBC “in order to rejoin, there’s something fundamental that would have to be true, which is, it would have to be the settled will of the country”.

Streeting was also asked about the appointment of Lord Peter Mandelson as the UK’s ambassador to the US.

Lord Mandelson was sacked last year after new revelations emerged after the extent of his relationship with the late sex offender Jeffrey Epstein.

“I wouldn’t have appointed Mandelson based on what was known,” Streeting said.

“I think he betrayed this prime minister. I think he’s got no future in public life. I’ve made no contact with him since he left his job and was sacked.”

The interview came after Streeting warned the Labour government was losing the fight against “nationalism”, in his resignation speech to MPs.

You can listen to the full interview on the Political Thinking podcast, which is available on BBC Sounds.