No plans to increase capital gains tax, Labour says

Labour has no plans to increase capital gains tax, the party's shadow chancellor Rachel Reeves has said.

The tax - paid on profits from selling an asset - is set at a lower rate than income tax.

Last week, Labour's deputy leader Angela Rayner criticised Prime Minister Rishi Sunak for paying a "far lower tax rate than working people".

It came after the PM published details of his tax affairs, including income from capital gains.

The summary revealed his overall tax rate was around 22% because most of his earnings came from capital gains related to a US-based investment fund.

For higher earners, capital gains tax is currently 28% on gains from residential property or 20% on gains from other assets.

Meanwhile, income between £50,271 and £150,000 is taxed at 40%, while the top rate of tax for the highest earners is 45%.

Asked on BBC Radio 4's Today programme if Labour would put up capital gains tax, Ms Reeves said: "I don't have any plans to increase capital gains tax."

She added: "There are people who have built up their own businesses who maybe at retirement want to sell that business.

"They may not have had huge income through their life if they've reinvested in their business, but this is their retirement pot of money.

"And we also have said we want Britain to be the best place to start and grow a business."

However, in a statement responding to the release of details about Mr Sunak's financial affairs last week, the party's deputy leader, Ms Rayner, appeared to criticise the rate of capital gains tax.

She said it revealed "a tax system designed by successive Tory governments in which the prime minister pays a far lower tax rate than working people who face the highest tax burden in 70 years".

No 10 has defended the rate of tax paid by Mr Sunak, saying he paid a "considerable amount" in capital gains tax.

"It is not unusual for savers to choose to put their investments in funds which focus on delivering long-term growth rather than short-term income generation," the prime minister's official spokesman said.

A summary of the PM's tax records showed he paid more than £1m in UK over the last three years on earnings of more than £4.7m.

His earnings included more than £85,000 in capital gains from the sale of a home he had bought with his sister, which she and her children had lived in.