Owen Smith has pledged to transform the UK tax system if he wins the current contest to become Labour leader, announcing plans to reinstate the 50p personal tax rate and introduce a new wealth tax on the richest 1% of taxpayers, in a bid to tackle what he described as ‘ballooning’ inequality
Speaking at the launch of his campaign for the leadership, in which he is taking on the present incumbent Jeremy Corbyn, Smith said the proposed wealth tax would be a charge of 15% on unearned income, for example from investment, that would only apply to people earning over £150,000.
Smith estimated this would raise £3bn a year, and said the money would go towards more funding for the NHS, which he said would see an annual 4% increase under a Labour government with him as leader.
He also plans to reverse recent cuts to capital gains tax (CGT) and inheritance tax (IHT) announced in the Budget and said there would be no more cuts to corporation tax.
Other suggestions in his launch speech included reintroducing wages councils to boost pay above the minimum wage in sectors such as retail and care and minimum guaranteed working hours with the abolition of zero hours contracts. Smith also wants to get rid of the Department for Work and Pensions and replace it with a Ministry of Labour and a Department for Social Security. In addition, he wants workers to be members of company remuneration committees.
