Huge growth in household wealth has not been matched by revenues from wealth taxes in the UK, according to a study published today (13 July) by the Resolution Foundation.
In 1980 the amount of wealth held by private households was equivalent to almost three times the UK’s annual gross domestic product (GDP). It has since risen by 174 per cent to nearly eight times GDP, creating what the think tank describes as “huge wealth gaps” between different sections of the population.
Over the same period, tax revenue from this soaring stock of wealth has risen much more slowly, by just 46 per cent.
The findings are outlined in the Resolution Foundation’s interim report on the state of the UK economy, Stagnation Nation, which finds that a “toxic combination of slow growth and high inequality” posed challenges to Britain’s living standards long before the Covid-19 pandemic and the current cost-of-living crisis. Such inequality has led Britain to trail behind other similar nations, with typical families now much poorer than those in comparable countries.