The case for a progressive annual wealth tax in the UK

Benjamin Tippet, Rafael Wildauer and Ozlem Onaran

No 33819, Greenwich Papers in Political Economy from University of Greenwich, Greenwich Political Economy Research Centre

Abstract: This paper analyses the revenue potential of a progressive annual net wealth tax in the UK. A progressive net wealth tax is a tax on the stock of net wealth that is designed to raise revenues primarily from the wealthiest households. We present a baseline progressive net wealth tax that only taxes the top 1% wealthiest households. Households with net wealth above £3.4 million (the top 1%) are taxed at a marginal rate of 1%; above £5.7 million (the top 0.5%) at a marginal rate of 5% and above £18.2 million (the top 0.1%) at a marginal rate of 10%. We estimate that this tax would raise roughly £70-130 billion a year after administration costs and tax avoidance/evasion: £70 billion if 50% of the tax is evaded and £130 billion if 15% of the tax is evaded. This is equivalent to roughly 9-16% of total tax revenues taken by the UK government each year.

Keywords: wealth inequality; wealth tax; fiscal policy (search for similar items in EconPapers)
JEL-codes: D31 H24 J50 (search for similar items in EconPapers)
Date: 2021-09-09
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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