On Wednesday the Prime Minister Rishi Sunak revealed how much tax he pays.

Sunak brought in £2 million in 2021 to 2022 – mostly from dividends and capital gains. He paid £432,000 tax on this income. 

This makes the PM’s effective tax rate 22%. That’s the same tax rate as the average nurse making £37,000 a year, as our Executive Director pointed out on Twitter.

This is simply incredible. And it shows precisely what’s wrong with our tax system: the super rich take most of their income from wealth, not work. And taxes on income from wealth are much lower than taxes on work.

“The system is designed to allow wealthy people to pay lower rates of tax”, we told The Times.

What we’re proposing is simple. We want the same rates of tax on income across the board, regardless of its source. So those bringing in £2 million from dividend income should pay the same as those bringing in £2 million from work.

If this were the case, Rishi Sunak’s tax rate would be much higher. If we applied the same rules to every super rich person in the UK, we’d raise £14 billion pounds every year. 

The value of shares, property and gold have hit new highs in the last year. It’s only a cost of living crisis if you don’t own a lot of assets.  

Food prices skyrocket

While the Prime Minister's tax return gives a snapshot into how the super rich are doing financially, the cost of living crisis is getting worse for everyone else. 

The cost of food has increased by 18% since last year, new inflation figures show. Goods and services generally are up 10%.

The skyrocketing cost of the weekly shop is bad for everyone, and is pushing many who were already struggling into poverty. The number of children in food poverty in the UK has doubled this year to 4 million.

This is unacceptable. The UK is a rich country, but wealth is increasingly hoarded by a small  number of super rich people. While wages have stagnated over the last 15 years for everyone else.

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A Budget that gives a £9 billion tax break to the biggest businesses and a multibillion pensions tax giveaway to higher earners is the wrong approach in the middle of a cost of living crisis.

Tax Justice UK Executive Director, Robert Palmer, said: “Jeremy Hunt tells NHS workers that we can’t afford to give them a pay rise during this cost of living crisis. Yet he just handed out a £9 billion tax break to the biggest businesses and promised a multibillion pension tax giveaway to the highest earners”. 

“Thousands of NHS workers are using foodbanks, there won’t be a single nurse with £60,000 a year spare to take advantage of the Chancellor's pension tax giveaway”.

“The 12 new investment zones look like being glorified business parks - they tend to shuffle activity around the country rather than generate new enterprise.”

“The Chancellor’s measures on child care are welcome, but tax breaks for the well off and big corporations are not the answer to our cost of living crisis”.

“Jermey Hunt calls this his growth budget, but you can't have sustainable growth if our workers are getting sicker, can't get to work or have trouble accessing essential public services. We need greater investment in our NHS and public services now. Politicians should be taxing wealth not pouring more fuel onto the wealth inequalities that already exist in our society.”

A Tax Justice UK briefing shared with MPs ahead of the Budget set out six wealth tax policies that could raise up to £50 billion towards rebuilding the NHS and public services.

The briefing includes a proposal for a 2% annual wealth tax on people with £10 million in assets. This policy alone could raise £22 billion

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The government could raise up to £50 billion by reforming the way it taxes wealth, according to our new research with Patriotic Millionaires UK.

​​There is a growing consensus that higher taxation of wealth could help solve current  economic crises – from low productivity growth to crumbling public services and wage  stagnation. 

Ask your MP to back wealth taxes using our free online tool:

The IPPR, the IMF, the Resolution Foundation, the IFS, and even the  Conservative-aligned think tank Bright Blue have all called for higher taxes on wealth in  response to these crises.

With the UK economy experiencing the slowest growth of any  country in the G7, the government should announce fairer and more robust taxes on  extreme wealth in its upcoming budget. This could enable investment in essential public  services and help to improve economic dynamism and growth. 

Higher taxes on the wealth of the super-rich enjoy widespread popularity among voters  across the political spectrum. Recent polling from YouGov found that 78% of voters  support an annual wealth tax on those with assets worth over £10 million, including 77%  of Conservative voters and 86% of Labour voters. A further 62% supported equalisation of tax rates on income from work and income from wealth. 

The following six policies comprise Patriotic Millionaires UK and Tax Justice UK’s top policy recommendations for improving fairness, simplifying the tax system, and raising  revenue ahead of the 2023 Spring Budget.

1. Apply a 1-2% wealth tax on assets over £10 million, raising up to £22 billion a  year. 
A small wealth tax applied to those at the very top of the distribution would affect only 0.04% of the population. This makes it much easier to administer than annual wealth  taxes set at a lower threshold, as it would affect only around 20,000 people. It would  ensure that those who have benefited enormously from structural economic changes over  the last decade contribute fairly and create significant revenue for national renewal. 

2. Equalise capital gains with income tax rates, raising up to £15.2 billion a year. 
This would have the positive effect of simplifying the tax system and treating all forms of  income in the same way. It has support from 62% of voters, according to recent research from academics at the University of Oxford. There is no obvious reason why someone  going to work should pay more tax on their wages than someone living from their  investments, for example. According to the Office of Tax Simplification, who advocated  for this policy change in 2020, it could raise significant revenue for public spending.

3. Apply national insurance to investment income, raising up to £8.6 billion a  year. 
Instead of just focusing on the rates of National Insurance, the government should expand  the tax base by applying National Insurance to income from investments – such as  dividends from shares, rent from property, and interest on savings. This would equalise  and simplify the treatment of different types of income under the taxation system, and  ensure that income from wealth is taxed at the same rate as earnings from work. It would  raise around £8.6bn. Simplifying the tax system would also substantially reduce tax  avoidance by limiting possible avenues for avoiding tax. 

4. End the inheritance tax loopholes that benefit the already wealthy, raising up  to £1.4 billion a year. 
The government should scrap or reform Business Relief and Agricultural Property Relief  on Inheritance Tax. There is evidence that these inheritance tax reliefs are being used as  loopholes by a small minority of the very wealthy to avoid paying the appropriate  inheritance tax on their assets. Abuse of Agricultural Property Relief is likely pushing up  the price of agricultural land for genuine commercial food production and has this year  been criticised by the Office of Tax Simplification. Scrapping these reliefs could raise  over £1.4bn a year. Alternatively, the Resolution Foundation has proposed reforms to  prevent them being exploited, generating a smaller saving. 

5. Reform the rules on non-dom status, raising up to £3.2 billion a year. 
Non-domiciled residents in the UK (‘non-doms’) receive at least £10.9 billion in offshore  income and capital gains each year, which they are not required to report to HMRC or  pay tax on in the UK. Taxing this income would raise more than £3.2 billion in additional  tax revenue each year and also remove the current disincentive to invest in the  UK, according to research by academics Dr Andy Summers and Dr Arun Advani.
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6. Introduce a 4% tax on share buybacks, raising approximately £2 billion a  year. 
Some of Britain’s largest companies are transferring profits to their shareholders at record  levels. According to IPPR, if the UK had implemented a share buyback tax at President  Biden’s proposed 4% rate, it would have raised £2.2 billion in 2022. Taxes on shareholder transfers would help to ensure that companies are not channelling profits to their shareholders at a time of national economic crisis and encourage investment in the real economy. Share buybacks artificially boost the value of shares that are overwhelmingly  owned by the wealthiest in society. 

​These revenue figures are estimates based on research from government institutes,  academics, and think tanks. In particular, the work of economists Dr. Arun Advani (University of Warwick) and Dr. Andy Summers (London School of Economics), co authors of the final report of the UK Wealth Tax Commission.

​This policy package is an  updated version of analysis released by Tax Justice UK ahead of the 2022 Autumn  Budget. Changes reflect new revenue estimates for annual wealth taxes and Capital Gains Tax reform, as well as the inclusion of a tax on share buybacks in response to their  rising prevalence, most notably in the US under President Biden.

Ask your MP to back wealth taxes using our free online tool:

An opinion poll by YouGov for Tax Justice UK has found overwhelming public support for an annual tax on extreme wealth ahead of this week’s Budget.

77 per cent of Brits said they would support a 1% annual wealth tax on people with more than £10 million in personal wealth; 74% said they would support a 2% annual tax on people with more than £10 million in personal wealth.

Tax Justice UK Executive Director, Robert Palmer, said: “The NHS and public services are on their knees, but the Chancellor, Jeremy Hunt, government keeps saying we can’t afford to pay workers properly.

“There is an alternative. The government could raise £22 billion alone by applying a 2% tax on the wealth of the richest people in the country.

“And this latest poll shows that this would be popular with the public. Jeremy Hunt should use the opportunity of next week’s budget to tax wealth and start rebuilding our public services.”

The full polling tables can be downloaded here.

A Tax Justice UK briefing shared with MPs ahead of the Budget sets out six wealth tax policies that could raise up to £50 billion towards rebuilding the NHS and public services.

The briefing includes a proposal for a 2% annual wealth tax on people with £10 million in assets. This policy alone could raise £22 billion.

The revenue predicted from the proposed wealth tax differs from our previous calculation as a consequence of increasing the tax rate from 1% to 2%.

Senior Conservatives are again loudly calling for tax cuts in the upcoming budget on 15 March. Three in five Conservative party members want the Chancellor, Jeremy Hunt, to prioritize tax cuts. Right leaning newspapers are pushing this agenda as well.

Many Conservative backbenchers argue that slashing corporation tax would boost growth. There’s little evidence for this. We’ve had low corporate taxes for the last decade. At the same time our economy has stalled – pay has stagnated and the cost of living has increased. 

A corporate tax cut would mainly result in soaring corporate bank balances – this at a time when many companies are reporting record earnings already.

As the 15 March budget approaches, we need to resist calls for tax cuts that benefit big corporations and push for higher taxes on the super rich instead. 

Our NHS needs more resources

Not only are these calls for tax cuts reckless – we all remember what happened when Liz Truss tried it last time – they also ignore the state our NHS and public services are in.

Our teachers, doctors and ambulance staff are going on strike. Nurses are using foodbanks. Our NHS is in the middle of one of its worst crises ever. 

These services are floundering. They urgently need more resources, not less. The government needs to provide more funding – and that should come from those with the deepest pockets.

That’s why we’ve been pushing a range of wealth taxes that could raise up to £37 billion a year. This money could be the lifeline our struggling NHS and public services need.