Daily Mail

...as hated wealth levies are set to rake in £170bn

- By Archie Mitchell Business Correspond­ent

WEALTH taxes will cost families more than £170billion over the next six years in a major windfall for the Treasury.

The amount households will pay in capital gains and inheritanc­e tax is set to soar, Budget documents show, spelling misery for millions.

Critics said the taxes were ‘inefficien­t’ and acted as a form of ‘double taxation’ on investors and entreprene­urs.

Jeremy Hunt has not moved to increase capital gains or inheritanc­e tax, but he and previous chancellor­s have overseen massive increases in the amount HM Revenue and Customs collects from them.

Last year the Treasury took £21.4billion from the levies – almost two-thirds higher than five years ago. In 2027/28 the taxes are expected to bring in £34.5billion – another 61 per cent jump.

In total, for the six years from 2022/23 to 2027/28, the Office for Budget Responsibi­lity

(OBR) has pencilled in £45billion from inheritanc­e tax and £126.1billion through capital gains.

The double whammy represents a £171.1billion wealth tax on households – £37.3billion higher than the OBR’s November forecast suggested.

Former business secretary Jacob ReesMogg said: ‘Capital taxes are an inefficien­t form of taxation. Capital gains tax is voluntary as the asset does not have to be sold so it distorts investment decisions and uses capital inefficien­tly.

‘Death duties are double taxation but also encourage investment for tax minimisati­on rather than economic efficiency lowering the opportunit­ies for growth.’

Matthew Lesh, the director of public policy at the Institute of Economic Affairs think-tank, accused the Government of ‘relentless­ly squeezing wealth-creators and entreprene­urs’.

He added: ‘Capital gains tax is a tax on investment, while inheritanc­e tax is a tax on working longer and harder.’

Capital gains tax is the levy paid on profits made when an asset, such as a holiday home or shares, is sold.

Higher-rate taxpayers pay 28 per cent on gains made on residentia­l property and 20 per cent on other assets.

Critics have also claimed inheritanc­e tax is increasing­ly a tax on middle classes. Currently, estates worth up to £325,000 can be passed on without paying inheritanc­e tax, with a levy of 40 per cent above that threshold.

The Government said Britain’s tax system ‘is fair’ with half of capital gains taxes paid by the wealthiest 1 per cent.

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