Sadiq Khan outlines concerns over Labour's planned wealth tax

London mayor Sadiq Khan says Labour’s planned wealth tax would hit the ‘equity rich but cash poor’ and cause a ‘flight’ of rich people out of the UK

  • Keir Starmer outlined plans for tax raid on homes and shares if he seized power
  • But Mr Khan has warned of the potential knock-on effects of such proposals
  • He’s also warned the PM not to damage the South East in his ‘levelling up’ plans 

Sadiq Khan has said Labour’s planned wealth tax would hit those who are ‘equity rich but cash poor’ and cause a ‘flight’ of rich people out of the UK.

Sir Keir Starmer warned back in September he would launch a tax raid on homes and shares if his party were in Government, warning it was time ‘those with the broadest shoulders should pay’.

Homeowners don’t pay the tax on sales their main homes but it is applied to any other property they own such as holiday homes and rental properties, when they are sold.

However, London mayor Mr Khan has distanced himself from such proposals, warning of potential knock-on effects.

Sadiq Khan has said Labour’s planned wealth tax would hit those who are ‘equity rich but cash poor’ and cause a ‘flight’ of rich people out of the UK

The London Mayor has also warned the Prime Minister that any ‘levelling up’ plans must not simultaneously damage the South East.

He told the Chopper’s Politics podcast: ‘We have always got to be careful about the unintended consequences of hypothetical tax increases.

‘I’m quite cognisant of the fact that it’s not me that creates the wealth and prosperity in our city, it is the small businesses, those who are innovators, those who are chief executives of big companies.

‘I’m not competing against Manchester, Liverpool, Edinburgh and Glasgow, I am competing against Paris, Singapore, New York, Hong Kong. What I don’t want is flight out of London to those global competitors.’

Mr Khan went on to say he had warned Prime Minister Boris Johnson, who was also his predecessor as mayor, that any ‘levelling up’ plans must not simultaneously damage the South East.

The premier last week faced accusations that he has ‘betrayed’ the North by axing flagship plans to improve rail. 

Conservatives MPs and local leaders joined a brutal backlash as the PM tried to defend his ‘ambitious and unparalleled’ overhaul of inter-city links.

Mr Johnson was accused of giving his crucial Red Wall voters ‘scraps off the table’ after the HS2 route to Leeds was ditched in favour of a Birmingham to East Midlands Parkway line. 

The HS3 line linking Manchester and Leeds – known as Northern Powerhouse Rail – is also being shelved.  

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