Scottish Labour MP among cross-party group demanding 'extreme wealth' tax

A Scottish Labour MP is one of 30 cross-party MPs and peers calling for an "extreme wealth" tax in this month's Budget.

Brian Leishman, the new MP for Alloa and Grangemouth, signed a letter to the Chancellor Rachel Reeves from the group calling for a new 2 per cent tax on assets worth more than £10 million, which they claim could raise £24 billion per year.

Those to sign the letter also include Diane Abbott, Clive Lewis, John McDonnell, Jeremy Corbyn, Carla Denyer, Zarah Sultana, Apsana Begum and Nadia Whittome.

In an email sent to the Chancellor, they argue that an extreme wealth tax would generate a large stream of revenue.

The group says that this money could be put into public services, reversing the effects of Conservative austerity. They also asked Reeves to equalise capital gains and income tax rates, saying this would raise £16.7 billion per year and “would rectify unfairness in the tax system, where working people are subject to proportionately higher rates of tax”.

Mr Leishman told The Scotsman: “If anything has been proved over the last 40 years, then it’s the idea that wealth will “trickle down” and benefit everyone in society is a myth.

“The cost of this ideology has seen billions of pounds flow towards corporations and the already very wealthiest. This along with austerity and tax cuts has meant that the wealthiest have raced away from ordinary people and we see an unfair and unequal Britain.

“Our schools, healthcare, social care and public services we rely on have been starved of funding.

Nadia Whittome MP attending a wealth tax demonstration outside Labour conference last month | Green New Deal Rising

“When redistribution of wealth is mentioned, often ordinary working people fear that it’s their wealth that would be taxed. But it’s not.

“While corporate profits and the wealth of the few have exploded, it’s clear that wealth is not being shared to the people that create it.

“If we think about the cost and value of things, then I believe that we simply can’t afford to continue the way we have been.

“The introduction of an Annual Wealth Tax on those with extreme wealth gives us the opportunity to raise approximately £24 billion a year. If we also equalise capital gains and income tax we could raise over £16 billion and make the tax system fairer for ordinary people.

“These are amounts that could effectively tackle poverty and allow us to invest in the infrastructure and services that would transform society for everyone’s benefit.”

They note that billionaire wealth has increased by almost £150 billion between 2020 and 2022, but revenue from wealth taxes has remained stagnant at around 3.4 per cent.

They write: “This is deeply unfair and immoral: in an age of climate and economic crises, where public funds are desperately needed, it is necessary that we redress this imbalance.”

The Chancellor will deliver the Budget on October 30.

At the election, Labour promised not to increase taxes on "working people", covering VAT, income tax or National Insurance, which limits the levers the Chancellor can pull to raise funds.

However, the Chancellor has quickly ruled out any wealth tax. She said: “We're not going to be bringing in a wealth tax, but there will be a number of difficult decisions around tax and spending and welfare.”