Britain’s opposition Labour Party hinted that it would impose new taxes on the wealthy, including shareholders and landlords, if it comes to power at the next election.
In an interview, Labour’s would-be finance minister Rachel Reeves said, “I do think that people who get their income through wealth should have to pay more”, while adding, “people who get their incomes through stocks and shares and buy-to-let properties”.
Conservative Prime Minister Boris Johnson is two years into what could be a five year term, after winning over many traditional Labour voters at the last election with a focus on finishing Brexit. However, the coronavirus-induced COVID-19 panic has forced his centre-right government to rapidly increase government spending and rack up debts which is likely to take generations to pay off.
“A Labour government would look to shift that burden further towards the wealthy,” said Reeves. “We should use the tax system to ask those with the broader shoulders to contribute more”.
Reeves also sketched out a set of fiscal rules that would govern Labour’s broad approach to public finances, including a commitment to reduce the debt to GDP ratio and balance day-to-day spending, albeit with new borrowing for capital investment.
“The purpose of having fiscal rules is to provide an anchor for government ministers and for civil servants, but also it can reassure the public and also markets that you’ve got a plan,” she said.
Between 2015 and 2019, Labour ran under a left-wing banner that unnerved financial markets with huge spending pledges, but now the party, led by the more-centrist Keir Starmer, is seeking to shape a more fiscally responsible image.