It’s not often that people ask to pay higher taxes – but’s that’s exactly what a group of millionaires are demanding.

The millionaires – part of the organisation, Partners in Progress – penned an open letter to Chancellor Rishi Sunak, just days before he made his 2021 Autumn Budget and Spending Review Statement. They called on the Chancellor to tax them and other rich people more because they can afford to pay it and “the cost of recovery cannot fall on the young or on those with lower incomes”.

The letter was published on their website, Proud to Pay, where people can sign up to the campaign. There is also a link where you can see who has signed the letter. At the time of writing, there were 31.

The group told Rishi Sunak to introduce a wealth tax on the nation’s richest people to help pay for the recovery from the coronavirus crisis and tackle the inequality gap.

The letter in full:

“We are writing to you as a group of UK wealth holders.

We understand the immense pressure on the Treasury to deal with crises both present and future – from inequality, to Covid, to climate change. We know there will be high expectations for you to find the money needed.

We know where you can find that money – tax wealth holders like us. We can afford to contribute more, and we want to invest in repairing and improving our shared services. We are proud to pay our taxes to reduce inequality, support stronger social care and the NHS, and to ensure that we’re building a more just and green society.

The cost of recovery cannot fall on the young or on those with lower incomes. There are many of us – people with wealth – who will support a more progressive system of taxation, and we urge you to do the same.

When deciding on how to meet the financial gap, look to us. Repairing our country is more valuable than growing our wealth.”

The background …

In 2020, the Wealth Tax Commission was set up to provide the first in-depth analysis of proposals for a UK Wealth Tax in almost 50 years. It concluded that a well-designed one-off wealth tax would:

  • Raise significant revenue in a fair and efficient way
  • Be very difficult to avoid
  • Work in practice without excessive administrative cost

The final report said: “A well-designed one-off wealth tax would raise a total of £260 billion at a rate of 5% over £500,000 per individual or £80 billion at a rate of 5% over £2 million per individual, payable at 1% per year over five years. These estimates account for all relevant behavioural responses and administrative costs to government. The tax would be fairer and more economically efficient than alternative tax rises. It could be targeted at those with the most ability to pay based on their wealth and would be very difficult to avoid. The administrative costs on taxpayers and the government would be small relative to the revenue raised.”

Government response 

So far, the Government has declined to take up the offer from the millionaires or to act on the Wealth Tax Commission’s report. And there was no mention of it when the Chancellor made his 2021 Autumn Budget statement. So, is it dead in the water? Or will the Government come under increasing pressure to respond? It will be interesting to see how this story unfolds!