Proposed 2% Wealth Tax for the UK’s Ultra-Rich

Academics Gabriel Zucman (Paris School of Economics) and Ben Tippet (King’s College London) argue that a 2 % minimum tax on households with more than £100 million in wealth could raise about £10 billion a year. The measure would target fewer than 1,000 of the richest UK households and would be levied on a broad asset base—including property, private businesses, pensions, art, land and charitable assets under the owners’ control. The report stresses that the tax is intended to make billionaires pay the same rates as the rest of society and to curb “runaway inequality.”

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Mayor Andy Burnham, the new prime minister, has signalled that a wealth tax could feature in his 10-year plan, while emphasizing a desire to avoid fresh social divisions. Speaking to Gary Lineker, Burnham said: “I do believe we need a greater sense of fairness and people feeling things are being done in the right way, but at the same time I don’t want to be perceived as someone who is coming in with grudges and agendas and demonise one group.” He added that any new levy would be considered “in a fair way.”

The Guardian

Critics of wealth taxes often cite administrative complexity, valuation challenges, liquidity constraints and potential disincentives for entrepreneurs. Tippet counters that these concerns “do not hold” for a narrowly targeted levy. The report notes that most historic European wealth taxes differed markedly: they featured low thresholds, covered large population segments and included extensive exemptions that fostered avoidance and political opposition. By focusing on the very wealthiest and applying a uniform rule—such as a ten-year liability period after a family leaves the UK—the proposal seeks to sidestep those pitfalls.

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• “I do believe we need a greater sense of fairness and people feeling things are being done in the right way, but at the same time I don’t want to be perceived as someone who is coming in with grudges and agendas and demonise one group.” — Andy Burnham, Prime Minister

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• “Given the small numbers of households that would be taxed, the UK government could implement this quickly.” — Gabriel Zucman, Professor of Economics

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• “The report shows that a well-designed minimum tax on the very wealthiest households is a realistic, targeted reform that would make the UK’s tax system fairer while raising substantial revenues.” — Ben Tippet, Lecturer in Economics and Wealth Inequality

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• “the familiar criticisms of wealth taxes – administrative complexity, asset valuation, liquidity constraints and impacts on entrepreneurs – do not hold” — Ben Tippet

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• “Wealth taxes work best when they focus on the very wealthiest households, apply to a broad asset base and are supported by strong administrative enforcement.” — Report conclusion

The Guardian