JOHN Redwood, the Tory MP leading a Westminster campaign against government plans to raise capital gains tax (CGT), yesterday urged George Osborne to rethink the proposals, just hours before his first Budget as chancellor.
“Let’s make a statement; let’s say Britain is open for business,” Redwood said. “We really want enterprise. If you want to stop things you tax them. If you want to promote things, you lower the rate and then you’ll get more revenue.”
Redwood, who has backed City A.M.’s own campaign against the hike, beseeched Osborne to reduce long-term CGT on both business and non-business assets down to 10 per cent, well below the current 18 per cent flat rate.
Redwood’s comments came as leading think tank the Adam Smith Institute warned that the Treasury faces a tax revenue loss of £2.48bn if the CGT hike goes ahead.
And the Royal Institute of Chartered Surveyors warned a CGT rise would deter investors from entering the buy-to-let market. RICS also said a hike could precipitate a “fire sale” of properties by landlords looking to avoid the increase, derailing a fragile improvement in sentiment in the sector.