Labour should be “willing to explore” bringing in a new wealth tax on those with substantial fortunes, Lord Kinnock has suggested.
The party’s former leader told Sky News that a 2% tax on assets worth more than £10million could help raise about £10billion a year for the Treasury.
He said the public was “fed up” with the richest going “unscathed” and suggested the policy would be “a substantial gesture in the direction of equity”.
His suggestion comes after Cabinet ministers were warned taxes would have to rise following Sir Keir Starmer’s climbdown on welfare reforms.
On Sunday night, some of Labour’s biggest union backers, including Unison, backed the call for a wealth tax. One union source told The Telegraph they would raise the idea with the Prime Minister and lobby Labour MPs.
But Downing Street is likely to resist the idea, after one of Sir Keir’s most senior advisers warned that recent levies on the rich may already be undermining economic growth.
Economists have also said such a move would trigger a fresh exodus of the rich from Britain.
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