Rachel Reeves backed 5 forms of wealth tax as pressure mounts to fill budget black hole

Rachel Reeves previously backed five different types of wealth tax while she was a backbench Labour MP, it has been claimed. In 2018, a pamphlet titled The Everyday Economy set out the levies and was published by the then chair of the Commons business comittee, The Telegraph reports.

In it, Ms Reeves suggested revising council tax bands, replacing council tax with property tax, raising and reforming inheritance tax, imposing a land tax, and bringing capital gains tax in line with income tax. The now Chancellor put forward "a radical overhaul of the tax system", arguing that the "current system of wealth taxation isn't working". At the time, wealth inequality in Britain was nearly twice as big as income inequality, with half of the country's wealth "owned by just 10% of adults", she said.

She also claimed that scrapping council tax altogether and replacing it with a property tax would be "more equitable", as landlords would pay instead of tenants.

Seven years before Labour introduced its reforms to inheritance tax through agricultural property relief, which has been dubbed "family farm tax" by critics, Ms Reeves called for sweeping changes to tackle inequality.

She wrote in the pamphlet: "Inheritance tax is not popular, but George Osborne's 2015 reform was not only unjust in deepening wealth inequality and the North-South divide, but it left untouched the loopholes through which the 'healthy, wealthy and well-advised' can avoid paying tax.

"It needs to be either reset or shifted wholesale to a tax on the receipt of any gifts throughout a lifetime, making tax on all gifts equal and thus avoidance more difficult."

This comes as the Chancellor could be forced to raise taxes in an effort to fill a staggering £40 billion black hole in the next Budget, experts warned.

Last week, the Government U-turned on welfare reforms, and the Chancellor said this would be "reflected in the Budget".

She did not explicitly say where the money would come from, but maintained her "fiscal rules" would not change, raising questions over the possibility of tax hikes.

Ms Reeves was also warned by the Institute for Fiscal Studies (IFS) that she will have to raise the same amount as she did in last year's Budget, which was slammed for slowing economic growth.

IFS economist Ben Zaranko said it was "not hard to imagine a world where they are of a ballpark similar scale to last autumn".