Here’s who Burnham will target for tax raids. I’m petrified, warns JEFF PRESTRIDGE
It won’t be long before Andy Burnham is this country’s Prime Minister. Like me, I imagine you’re not as titillated as most Labour MPs are about the prospect of Burnham at the helm – and rightly so. I’m petrified.
If you thought life for the prudent was ugly under Keir Starmer, think again: you ain’t seen nothing yet. Things financial are going to get rather nasty once Burnham gets his feet under the desk at ‘No 10’ in Manchester.
Prepare for pain, ladies and gentlemen. We are about to be soaked by a storm of tax rises that will erode our wealth.
Burnham might be charismatic like Tony Blair was but his politics sit more in the Corbynista camp. Socialism on steroids. Envy politics. How quickly Burnham turns the screw on our wealth depends in part upon who he decides to appoint as Chancellor of the Exchequer, his financial enforcer.
If he asks Yvette Cooper, Shabana Mahmood or Wes Streeting to take on the job, I imagine they would carry on the strategy of the incumbent Rachel Reeves – and steadily chip away at our wealth.
It won’t be long before Andy Burnham is this country’s Prime Minister. Like me, I imagine you’re not as titillated as most Labour MPs are, writes Jeff Prestridge
If it’s Red Ed Miliband, I would consider fleeing the country. As shown during his time as Secretary of State for Energy Security and Net Zero, he doesn’t hold back when it comes to making unpopular policy decisions.
He would take great joy in hitting the middle classes with a raft of tax hikes.
He’s a fearless and somewhat unhinged socialist with a strong jaw. The same can be said about Treasury minister Torsten Bell, who has also been named as a potential Chancellor-in-waiting. His hatred for those with wealth is on a par with Red Ed’s.
Burnham would be wise to keep both well away from No 11, irrespective of whether it’s Manchester or London based.
The bond markets would not take kindly to Red Ed or Taxing Torsten, landing the Government with higher interest payments on their vast borrowing. Irrespective of who ends up as Chancellor, it’s not difficult to see where we are heading with a Burnham administration.
He has already indicated that the Labour manifesto commitment to not increase rates of National Insurance, income tax and VAT will remain in force – although it’s a pledge that has already been undermined by higher NI bills for employers and millions of people being drawn into higher rates of tax as a result of frozen tax allowances. Rumours of the restoration of the 50 per cent income tax rate for top earners refuse to go away.
If it’s Red Ed Miliband, left, I would consider fleeing the country. As shown during his time as Secretary of State for Energy Security and Net Zero
Burnham’s main focus, however, will be on hiking wealth taxes, justifying this on the grounds that wealth is taxed less than income from work.
As a result, higher capital gains tax (CGT) rates on share sales and property disposals are a dead cert. The only question is how quickly the rates will rise (they are currently set at 18 per cent for basic rate taxpayers, 24 per cent for higher rate). Miliband and Bell, I imagine, would have no hesitation increasing them straightaway in line with income tax rates in the Autumn Budget.
Streeting, Mahmood or Cooper may prefer a gentler approach, moving towards an alignment by the time Parliament ends in 2029.
For many investors and private landlords, pernicious CGT rates could represent the final straw, persuading them to dispose of assets ahead of the Autumn Budget (if the new Chancellor follows Reeves’ approach in 2024, any rate hike would be immediate).
To add insult to injury, Burnham’s Chancellor could also do away with the CGT ‘uplift’ on death. This uplift allows the assets of the deceased to be sold by beneficiaries at their market value without having to pay CGT on any gains made before death.
Removing it would create the possibility of estates being hit with a double death tax: CGT and inheritance. Frightening.
Other wealth taxes include the possible imposition of an annual land tax on homeowners – and a social care levy.
These would likely replace existing taxes but it is unlikely any changes would be made unless they drive more money into the Treasury’s coffers.
As for the gaping hole in the Government’s funding of our nation’s defences, Burnham will look to the middle classes to provide a sizeable chunk of the Polyfilla. It doesn’t look good. Burnham is gunning for our wealth.
