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Gary Lineker is among 120 UK-based millionaires calling on Andy Burnham to impose higher taxes on their wealth in an open letter. 0:00 | George Bangham lays out the argument for a wealth tax 4:44 | Former investment banker argues against the tax 7:45 | Adrian shuts down the ‘paper thin’ proposal 10:58 | Chris argues a wealth tax would reduce the need for food banks 13:38 | Jason calls for a reduction in wealth tax 15:28 | Wealth tax will ‘stimulate growth’, says Peter 18:23 | Tom says billionaires should be targeted over millionaires The “Proud to Pay” letter to the Prime Minister, organised by the Patriotic Millionaires UK campaign group and published on Thursday, claims the money raised from higher taxes on wealth could be used to reduce inequality, support public infrastructure, and back small businesses. It reads: “We want you to tax us. We can afford it." Listen to the full show on the all-new LBC App: https://app.af.lbc.co.uk/btnc/thenewlbcapp #nickferrari #garylineker #millionaire #tax #politics #economy #LBC LBC is the home of live debate around news and current affairs in the UK. Join in the conversation and listen at https://www.lbc.co.uk/ Sign up to LBC’s weekly newsletter here: https://l-bc.co/signup
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0:00
Patriotic Millionaires, the organisation of which Gary Lineker is a supporter
0:03
so I can't say that he underscores this particular policy, but they want a 2% tax on wealth over £10 million
0:09
that they say would raise £24 billion a year for the UK
0:15
But does a wealth tax work? Well, let's hear prosecution and defence
0:19
First, George Bangham is head of social policy at the New Economics Foundation
0:23
I understand you're a fan. Why? How would you imagine it would work? What could it result in
0:28
Good morning. Good morning, Nick. Good to be with you. I start on this basically from the point of view that most people think and most people agree that people's lives should be determined more by their talent and their effort and the work they put in rather than to what they own
0:44
And at the moment, we're in a situation where that's just not happening because your average person out there in the country, they're paying about a third of their income in tax
0:53
If they've got a higher income, it's about 45%. If you're extremely wealthy, it's far lower
0:59
So on average, it's more like 25%. So is that fair? Explain how that figure breaks down, George
1:05
How have you got, just so my listeners understand, how you've taken us from 45 to 20? Yeah, so it's 45 down to 25 if you're extremely rich
1:13
And the reason being essentially that if you're extremely wealthy, you're able to reclassify your income in different categories
1:19
you're not paying kind of you know paye on your payslip like most uh people do your tent you have
1:26
much more discretion as to like how your income is taxed so you might classify it as capital gains
1:31
for example and we know that the top rate of capital gains is uh is 12 percent lower than the
1:36
top uh than the kind of higher rate of income tax for example so there's lots of um ways like that
1:41
that um the very 28 then does it come in yes so yes okay go ahead yeah on your go thank you so
1:48
So, yeah, so in terms of how do we go about addressing that, you wouldn't necessarily need to jump straight to sort of the sort of much more far reaching wealth tax proposals
1:58
Where I would start is something quite simple, which has been talked about quite a lot
2:02
For example, aligning the rates of capital gains tax with the rates of income tax
2:06
That's something that would fix some of the issues that you've talked about
2:11
And it's something that whether you're right or left politically, it's something that basically just redresses this balance
2:17
which means that if you're working, you're paying a lot more tax than someone getting the exact same income as somebody not working
2:24
but deriving their income from assets they already own. At the start, George, you said that people get the money
2:29
through the talent and the work they put in. Surely that's what Mr Lineker did, because I happen to know
2:34
because my mum was raised in Leicester, Gary Lineker's dad ran the fruit and vegetable in Leicester Market
2:40
so Mr Lineker has reportedly got in excess of £10 million in the bank
2:44
because of talent and the work he put in, eh, George? Yeah, absolutely. No, that's certainly correct
2:50
And I'm sure he's paid plenty of tax quite rightly as a result
2:55
A lot of this issue arises at the very top of the wealth and income distributions
3:01
But also for people who are sort of merely very highly wealthy rather than extremely wealthy
3:07
they do still have a lot of discretion. So actually, footballers, you know, they're getting a salary
3:11
So this probably is less of an issue for them. The issue more is people who are able to really change a lot the form of their income
3:18
and particularly if you can take capital gains or if you can pay yourself in dividends
3:22
or if you're a landlord. You know, landlords pay a much lower rate of tax on their income than their tenants do on their income from work
3:30
I think most people would agree that that's not the fairest way to arrange things
3:35
and a few tweaks to the tax system could change it quite quickly. But last year, 16,500 high net worth individuals left the country
3:44
That's up from 10,800 the previous year. I'm going to... Of course, not every rich man or woman is going to leave the country
3:50
Of course, they're going to have children and grandchildren and roots here and everything else. But you don't want high net worth individuals queuing at Heathrow and Gatwick Airport to get out of town, do you
3:59
Well, you always get stories. I mean, there's a constant stream of stories like this
4:03
It's 16,500. That's a verified number. Yeah, I mean, well, there's a couple of things to say
4:09
One is that lots of people come and go from the country every year
4:13
so you need to look at the net rather than the gross flow. Second thing is there are ways to fix that policy-wise
4:18
They're not all high-net-worth individuals who are riding, are they? No, I mean, it's a mix
4:24
But there's other issues that determine why are people coming to the UK
4:30
and other aspects of our economy are the things that matter. The City of London is world-leading, and yeah
4:36
That's the fundamental. Grateful for your time, George Bangham, your head of social policy at the New Economics Foundation
4:41
12 minutes after 8. Listening to this, Dr. Andrew Solanki, who's an entrepreneur and former investment banker
4:46
You have concerns, I understand, about the wealth tax. Share them with my listeners, if you would
4:50
Morning, Doctor. I do. Good morning. I'm really dismayed by this. Our country if you obviously look at the financial and economic state of our country we need a huge amount of money That only really going to come from growth And I never seen anyone tax their way into growth
5:07
When I look at the wealth tax, so you have a look at the numbers, and this is what I get
5:11
slightly frustrated about, because the public look and they go £100 million, right, that wealth
5:17
that you've got, of course, what's 2% of that? It's nothing. But the reality is, as we're talking
5:21
about, a fewer than 1,000 households here, when you look at the OECD countries, you know
5:26
The majority of them have abolished this because it doesn't work. And then when you look at net assets, let's have a look at what we're talking about
5:33
It could be things like, OK, not just property, shares, art, things that are really difficult to value, businesses
5:41
And so what you get is just a whole bunch of administrative costs because you can't even value these things correctly
5:48
There's many illiquid assets there. So to carve off 2% of that amount of wealth actually for some people doesn't happen easily
5:55
So then what you get is just a basic outcome here, which is a move overseas or a restructure
6:01
of the finances. And just so you know, like, obviously, I am an informal investment banker
6:05
but my business is one that's been based on social change. So I care deeply about equality
6:11
I can just tell your listeners, this is not the way forward. We need to sort out the real
6:16
problems in our country. And that's getting young people back to work. It's actually boosting
6:20
innovation. It's deregulation. Because even that money, let's just say we can, that estimate is
6:26
correct. I don't believe it will be. I believe it's completely wrong. But if that's correct
6:31
that doesn't even get to the crux of the issues in our country. So we're just going to
6:37
we're going to remove all innovation and entrepreneurship in our country. I'm so
6:41
anti it, but I just want people to know I'm not, I'm pro equality. It's just not the way forward
6:46
But to those, Dr. Hussé, and I quote a previous Labour Chancellor, those with the broadest shoulders, shoulders should bear the greater burden. Why are they wrong
6:56
Well, it's not the reality of how things work. I was at dinner last night with our friends who moved to Dubai. I mean, I know many of our friends and family have moved abroad. Italy, Dubai, Switzerland, no intentions to come back
7:09
and that it do you know what we want the reality we want things to be fairer but we're better off
7:15
getting that by promoting ambition in this country and being the country of innovation so we can
7:23
afford the welfare bill we can afford the defense we can afford all that the energy infrastructure
7:27
projects we can get pete the homelessness out that's the way we're going to do it i think
7:33
I say this, of eight years I've spent running a business on equality
7:37
Eight years, and I've come to this point where I say this is how we're, to get what we need
7:43
we just, everyone needs a bit more Adrian's in Amersham, Adrian, your reaction to this, good morning
7:47
Good morning, I'd better keep these standards up, these high standards You will, I'm sure you will
7:53
Well, I was just triggered, so I'm still a bit irritated by George George
7:58
You know, who just sounded so infantile and glib Well, he's not independent, so he's the gentleman from New Economics
8:05
Let's talk about his arguments. Why did his arguments annoy you? Well, firstly, OK, I'm writing a business plan at the moment, OK
8:11
And one of the incentives which we're raising money under is called an SEIS and EIS
8:15
That's a super enterprise investment scheme that gives you 50% of your money back that you invest
8:21
Not that I know anything about them. Not that you've never dabbled in them
8:25
You've been writing a chat with Gary, haven't you? So, look, the government encourages long-term investment
8:31
with a different tax structure, and capital gains is part of that. It's there to encourage investment not to live on
8:36
So that's the first thing, just kick that out of the park. Secondly, you talked about people that own properties
8:42
live off rents, they pay less. Well, property rental income is going to companies that pay VAT tax and national insurance on payrolls
8:47
So that's true. I should have challenged him with that. And then owners or directors have to pay increasing tax on dividends
8:53
which are the same as income tax now, OK? This is just me sitting here listening to it with a cup of tea
8:58
This guy is, the proposition from these, it's very far left, yes
9:03
that you bring inequality down, yes, by killing the people at the top
9:07
The tall poppy syndrome is one way of putting it, yes. It's very, and it's low-grade intellectually
9:11
And let's give some real-world examples. They've just done VAT on private school education fees, yes
9:18
Yes, they have, yes. The mooted number, the proposed number is not being hit, yes
9:24
So the tax take is under. The consequences are a lot of change and misery and difficulty
9:29
for the people that send their kids to the school. And the additional cost, the predicted consequences
9:34
they chose to ignore because of political ideology, is that the state is taking a lot more pupils back into it
9:40
costing a lot more money. So I don't mind things that work for everybody
9:44
and work for the good of the country. You know, citizens, taxpayers all want to get behind propositions at work
9:50
and good lucks for Prime Minister. But when things are driven by mean ideology that you can kick out into the long grass in the sixth form or teenage years not pragmatic real reality then I against them And I against these glib statements from people like George that are literally paper thin Question What line of work is your SEIS in What attracted you to do it How easy or otherwise is it finding the dough
10:17
I've been in telecoms and technology for about 20, 30 years, so I'm quite well known in it
10:22
Right. And we've got some new ideas, and we're leading on an AI productivity story
10:26
We're not leaning on that AI is about job losses. So it's AI and technology, and there's a lot of interest
10:31
The technology sector, Nick, has got a lot of growth in it and huge potential
10:35
And we need to get away from all these scare stories coming out of the big vendors that it's all about job losses and the end of the world
10:41
It's not the end of the world at all. It's offering opportunity and growth, which is the key more
10:48
It's not in the lexicon, political or economic lexicon, and it needs to be
10:52
and tech is one of the ways to give productivity and increase rates of wealth and pay taxes
10:59
Chris, in Irvine, Chris, what do you want to say to the idea of a wealth tax? Good morning. All right, Nick. Good morning to you
11:06
It's just more literally, on a wealth tax, the top 1%, you're saying they pay 33%
11:11
They do. Right. Now, how many of them people go to a food bank
11:16
after they've paid their tax? Zero, I would imagine. Exactly. Thank you. You've just answered the question
11:21
That's great, Nick. Now, how many people that work full-time and receive universal credit go to food banks
11:29
I don't have a number. I'm sorry. I would love you to get your researchers and you get that
11:34
I can guarantee you it's millions. How is a wealth tax going to stop those folk having to go to food banks
11:41
Because they can maybe stop taxing them. The amount that they're taxing them and give them a little bit back
11:48
Hold on, hold on, hold on, sir. what are called HNWs, high net worth individuals
11:54
In 2024, 10,800 left the country. Last year, that had swelled to 16,500
12:01
Not all, but many have the means, the lawyers, the cash. They'll just go elsewhere, Chris
12:08
And so the tax take is diminished because you lose all those billionaires, in some instances, and millionaires
12:13
It makes no sense. Right, so that's your argument on it, but I'm pretty sure people with the lower-ended argument are just sick and tired
12:23
Well, let me take you to France, where a wealth tax was introduced. It raised 0.2% of GDP
12:30
It was finally abolished because people such as Bernard Arnault, owner of LVMH
12:36
and Gérard Depardieu, it's important you pronounce that correctly, left the country, along with many other high-profile millionaires
12:43
and in Monsieur Arnold's case, billionaires. I could tell you the same as Sweden
12:47
It raised 0.2% of GDP, and a number of billionaires left Sweden
12:51
Shall I go on through Norway, India and other countries? They don't work, Chris
12:56
Well, Nick, let me come back in here now. Yesterday you were talking about people in toothpaste and toothbrushes and stuff like that, right? Yes
13:03
Now, the poorest people are literally... The reviews are on that, by the way, that's gone really well. The poorest people have been left with almost nothing, no disposable income whatsoever
13:13
That's more important than rich people leaving the country. No, no, no. I agree with you
13:18
We have got to do something about people who have to go to food banks. But you don't do that
13:22
You must find other ways to get the money, such as something that Mr Burnham is looking at
13:27
which is the people who make all their money by delivering products from warehouses. Let them pay the same sort of tax that businesses do
13:34
That's how you do it, Chris. You don't chase billionaires and millionaires off to Heathrow Airport
13:38
Personally, I think we should do it slightly differently. I think we should actually bring the wealth tax down to the billionaires
13:44
to encourage more of them to come to this country. I love that idea. Because then we're going to collect a lot more money
13:49
Yeah. But I think it's a case of working smarter rather than harder for the HMRC
13:54
To me, it just makes sense. Why do we want to lose billionaires? We want more billionaires in this country
13:59
because we get loads of tax on them. Well, it's not just that. They then employ the drivers and the gardeners
14:05
and they go to the restaurants and whatever else it might be and they bring in employment
14:09
But unfortunately, if you've got the sort of green-eyed jealousy, You cannot see it that way. Everybody has to be brought down
14:17
Which is beyond ridiculous, because as you say, they spread their wealth right across this country
14:21
and I want their money in this country, because it will help all the problems that we've currently got
14:26
if we're collecting more tax from billionaires by bringing more billionaires in
14:31
Yes, I agree with you, the shopping outlets should be paying more money
14:36
no matter how you buy your product. I think he's onto something there, totally agree with him. 100%. But just let's get as many billionaires in this country as possible
14:42
it will help the housing market and it will bring a lot more money into this country
14:47
So reduce it for billionaires. Totally with you on that. Meanwhile, thank you for that, Jason
14:51
T says, good riddance to wealthy, unpatriotic people. This comes in from, have you said, yes, Simon
14:58
Bring back the non-DOM tax status. Set it at In the first year you get 50 people That would bring in billions 7 billion and then up the personal tax allowance to 16 and double that tax allowance for anyone 65 and over
15:14
I do agree that that tax allowance is far too low, which it seemed the Prime Minister thought was
15:19
but now might be changing. Peter's in Uxbridge. Five minutes before nine
15:23
Does a wealth tax appeal to you, and if so, why? Peter, good morning. Hi, Nick. Hi. I'm a first-time caller
15:29
Great to be on. So it's good to be on. Yeah, my point is that actually something that's not been mentioned yet is that wealth taxes will actually stimulate growth
15:39
The reason for that is because the rich have their money tied up in assets
15:44
During that time, it's not doing very much good for the economy. Ordinary people, on the other hand, they've spent a bigger proportion of their income on goods and services, which will stimulate the economy
15:57
So I think actually we're barking up the wrong tree. But those people are, of course, in many instances, investing in new businesses, perhaps opening a new business and offering employment to people
16:07
And then they can get you. Do you not see that part of the equation, Peter? What do you think
16:11
I do. I do see that part of the equation. I work with a lot of young people who want to start their own businesses and want to become rich
16:18
One of the things they're not that's not putting them off is a wealth tax. None of them are saying my ambition is going to be stifled by the fact that I might be taxed at 2 percent of my wealth
16:30
So I don't think it is going to put people off. But, again, you don't really know until you try it
16:38
but if you look at global precedence, it doesn't work. Well, actually, it doesn't work
16:44
Maybe we need to look at how it's implemented, but I won't take you around those European countries again
16:49
but it just doesn't... Anyway, go to Colm with the point you want to make. Sorry
16:53
A lot of it is because of how it's been implemented. I mean, one of your callers mentioned people fleeing to Switzerland
17:00
Switzerland actually does have a wealth tax. One of your other callers mentioned America
17:06
In the US, there is an exit tax. So what we could do is we could say to people
17:10
you will pay this tax. If you leave the country, then we will continue to tax you
17:16
That's what Americans do. If you're an American citizen, you pay tax to the US
17:20
Do you agree? Wherever you are in the world. Yes, I know. Do you agree this country could do with wealth creators
17:25
Do you agree? Yes, completely agree. Why would we try and go out of our way to make it difficult for them to be here
17:33
Well, we're not trying to make it difficult for them. We're just trying to make them pay their fair share of tax
17:37
But then they won't come here, will they? They'll stay in Dubai or they'll go to Italy, where I think is €150,000 ahead
17:45
You can move into that country. Well, I think you can see from the London property market, people are queuing up to come to the UK
17:56
The number of properties in London that are now owned by foreign nationals is huge
18:01
They don't live here. I mean, they're buying them as investments because they think, obviously, one day the country will
18:07
But they don't actually physically move here. They just buy the property, which, again, makes it impossible for people in London
18:13
at the higher end of the market, by the way, we're not talking starter homes here, to ever get involved
18:17
Peter, thank you. I must finish with you to give just under a minute. Thanks, Peter. Tom in Southampton, you're on the radio, Tom
18:22
Good morning. Hi, Nick. I just wanted to mention that wealth taxes are less about raising direct revenue through taxation, which I fully accept
18:33
In all examples so far, wealth taxes have proved to be... It might be the implementation, of course, of them
18:38
Oh, of course, yeah. Wealth taxes don't necessarily create lots of revenue
18:43
I fully conceive that. But that's not their role. What their role is, is to prevent excessive accumulation and centralization of wealth in assets among few individuals
18:58
So what that looks like is, for example, if you're a billionaire and you're investing in lots and lots of assets, you're taking those assets out of the market away from the next rundown, which is millionaires
19:13
Right. millionaires are wonderful for the economy they spend a lot well why wouldn't a billionaire spend
19:20
a lot because a billion is so much larger than a million no i got that that your your ability to
19:30
spend that wealth but think of all the people that you might be employing with all your businesses
19:35
as a billionaire yeah you don't need to but you don't need to but you do it's just it's almost
19:40
inherent in you that you just want to quite rightly thank the lord you just want to carry
19:43
on growing your business. It's fantastic. It's a virtuous circle. Earn more, spend more
19:48
employ more, round and round it goes. You don't want to be dreary and put a wealth tax
19:52
on all of that. Billionaires don't, billionaires aren't physically able to spend the wealth they make. That's the problem, is that billionaires will
20:03
have nice businesses that will make them money, but a majority of their wealth is tied down
20:08
in assets
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