Sunak Orders Review of U.K. Capital Gain Tax After Virus Splurge
(Bloomberg) -- U.K. Chancellor of the Exchequer Rishi Sunak has ordered a review of capital gains tax, as the Treasury tries to find ways to get back some of the money it has poured into supporting the economy during the coronavirus crisis.
The Chancellor has written to the Office of Tax Simplification to ask it to look at the performance of the tax, which covers profits made from investments including shares, second homes and rental properties.
A Treasury official who asked not to be named said the review was standard practice. They pointed out that a similar review of inheritance tax had taken place 18 months ago, and that the Treasury still hadn’t responded.
Sunak last week announced further emergency measures to support business, taking the cost of the government’s response to the virus to 190 billion pounds ($240 billion).
The budget deficit is on course to hit 350 billion pounds in the current fiscal year, according to the Resolution Foundation and the Institute for Fiscal Studies. That would be equivalent to about 17% of GDP.
At last year’s election, Sunak’s Conservative Party promised not to raise income tax, national insurance or the U.K.’s sales tax, VAT. That makes taxes on wealth and inheritance look more attractive.
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