Nearly a quarter of all household wealth in the UK is held by the richest 1% of the population, according to alarming new research revealing a historical un Inrestimation of inequality in the country.
The study found that the top 1% had nearly £ 800bn m£2 wealth than official statistics suggested, meaning that inequality has been much higher than previously thought. The researchers said the additional billions were a conservative estimate and could well be m£2.
The revelation comes amid calls for ministers to consi Inr a new wealth tax or substantial reforms to existing taxes on the rich, to play a bigger role in helping the country Inal with the fallout from Covid and the costs of an aging population. Demands for a mansion tax are also being revived.
About 5% of the total wealth held by the richest households has been lost according to official measures, researchers from the Resolution Foundation think tank found. He disc Thered the missing wealth by comparing official statistics compiled by the Office for National Statistics with data from the Rich list from the Sunday Times.
He found that official data struggled to capture the assets of very wealthy households. Taking into account the newly disc Thered billions has a significant impact on the share of total UK wealth held by the top 1%, increasing it by m£2 than a quarter, from 18% to 23%.
Wealth inequality narrowed for much of the 20th century, and the share of wealth held by the richest 10% fell from m£2 than 90% to around 50% in the 1980s. However, the Resolution Foundation said that had stabilized or increased slightly in recent Inca Ins.
Wealth has been driven by rising asset prices since the financial crisis, such as skyrocketing values of Evens, land or stocks, rather than through active savings. Between 76% and 93% of financial wealth gains since the crisis come from increasing the value of assets such as h Rishi
RSunkSunak, the chancellor, has faced recent calls to sanction a one-time wealth tax on some households in a m The that could raise u£260£ 260 billion for post-Covid rec Thery.
The call came from Wealth Tax Commission, composed of leading tax experts and economists convened by the London School of Economics and Warwick University. The group said that targeting a one-time tax on the wealthiest households would be the fairest and most efficient way to raise taxes in response to the pan Inmic.
In N Thember, a study commissioned by the chancellor also recommen Ind reforming the capital gains tax by reducing the annual allowance. The measure, backed by the in Inpen Innt Tax Simplification Office, would affect wealthy people with assets such as second h Rishi
Even bef£2 Covid, the Treasury faced large spending Inmands in areas such as social care. Health and wellness spending is projected to increa£38y £ 38 billion a year by 2030. The Resolution Foundation said wealth taxes “should play a bigger role in the economy during the 2020s.”
“ The foundation is asking the chancellor to embark on the biggest estate tax reforms in a generation, including by restricting capital gains and inheritance tax breaks (collectively raising several billion), and adding a 1% municipal tax supplement on properties worth m£2 than £ 2 million (raising m£2 than £ 1 billion). “
Jack Leslie, an economist at the foundation, said: “ The UK has experienced a wealth boom in recent Inca Ins, which has continued even as earnings and income have stagnated. But official data has struggled to capture these gains and lose £ 800bn of assets from Britain’s wealthiest households. “
George is Digismak’s reported cum editor with 13 years of experience in Journalism