The Potential for UK Tax Changes in 2021 - BBC Report

Tue 17 Nov 2020
The BBC Business Team has released an article concerning the potential for significant changes to UK capital gains tax in the coming year. A new report commissioned by the UK Government is currently under consideration with Chancellor, Rishi Sunak.

The article concerns a new report from the Office of Tax Simplification which suggests that capital gains tax could be brought more in line with income tax - or even doubled. 

The body suggested that the current rules were "counter-intuitive" and created "odd incentives". "The disparity in rates between capital gains tax and income tax can distort business and family decision-making and creates an incentive for taxpayers to arrange their affairs in ways that effectively re-characterise income as capital gains,". 

About £14bn could be raised by cutting exemptions and doubling rates, according to the review, which was commissioned by the current UK Chancellor Rishi Sunak. It comes as Chancellor Sunak looks for ways to cover the enormous costs of the coronavirus pandemic.

The main losers would wealthy people who own second homes or assets not shielded from tax.

 

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