Sam Robinson and Ryan Shorthouse

January 2022

The report proposes that the UK should lower taxes on an individual’s work to aid the post-COVID economic recovery and reward effort and enterprise. At the same time, the UK should increase taxes on an individual’s wealth to some extent to offset in part the losses in revenue from lowering taxes on work, as well as respond to rising wealth levels and the increasing role of luck and inheritance in life outcomes.

Tax is an incredibly politically sensitive policy area. The Treasury is inherently conservative in changing taxation policy. To do what we propose around work and wealth taxation, there will be difficult and potentially unpopular decisions along the way. But the long-term reward would be a tax system that makes the UK more efficient and equitable.

A centre-right Government that is committed to ‘levelling up’ the UK should rebalance the tax system from income associated with work and effort and onto income associated with privilege and luck.