Taxing Extreme Wealth in the United Kingdom: Revenue Estimates for a 2% Minimum Tax on Ultra-High-Net-Worth Households

Ben Tippet and Gabriel Zucman
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Ben Tippet: King’s College London
Gabriel Zucman: Paris School of Economics; University of California, Berkeley

No 46, Working Papers from EU Tax Observatory

Abstract: The super-rich in the UK, like in many OECD countries, pay lower effective tax rates than ordinary workers. At the same time, the wealth of the richest 300 households has increased from around 5% of GDP in 1989 to 16% today. This report presents a response to these challenges: a minimum 2% average annual tax on the total wealth of households with more than £100 million in wealth. The tax would raise around £10 billion in 2026, equivalent to 0.3% of GDP and almost one-third of the projected government current budget deficit. As only the richest 1000 households would be taxed, the usual criticisms against historic wealth taxes – administrative infeasibility, tax evasion, valuation problems, illiquid assets and a dampening of business innovation – do not hold. The proposal would include a 10 year post-emigration period under which households would remain liable for the tax, building on recent similiar changes to inheritance taxes. Given the small numbers of households involved, the tax could be implemented quickly to stop preemptive flight. Revenues remain substantial under a range of alternative assumptions regarding the tax model and behavioural responses.

Keywords: Wealth taxation; Wealth inequality; Super-rich; Tax avoidance; Tax migration; UK taxation; Tax progressivity (search for similar items in EconPapers)
JEL-codes: D31 D63 H21 H24 H26 (search for similar items in EconPapers)
Pages: 33 pages
Date: 2026-06
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