Lord Jim O’Neill Warns Against Wealth Tax Hikes

Lord Jim O’Neill, a former Treasury minister and senior ally of Andy Burnham, warned that increasing wealth taxes in the October 28 budget would be stupid and damage economic growth. He specifically cautioned against raising capital gains and inheritance taxes, arguing that such moves could result in a net loss for the Treasury as entrepreneurs defer sales or move assets overseas.

Lord O’Neill recently declined an offer from Andy Burnham to serve as the government's Chief Economic Adviser. He urged the administration to prioritize welfare reform to reduce national debt and to focus growth initiatives on specific hubs, such as London and the northern powerhouse region, rather than pursuing a universal growth pledge.

These warnings come as Chancellor John Healey manages defense spending shortfalls and the economic fallout from the Iran war. While the Treasury has seen record capital gains tax receipts recently, some economists describe this as a sugar hit caused by taxpayers rushing to sell assets before previous rate increases took effect.