UK Treasury Mulls $40 Billion Tax Hike to Plug Gap in Corona-Hit Finances, Report Says

UK Treasury officials are considering a £30 billion ($40 billion) tax raid on the wealthy to fill the gap in the country’s finances caused by the COVID-19 crisis, The Sunday Times reports.

The newspaper cited Chancellor of the Exchequer Rishi Sunak as saying that “the political reality is that the only place you can get the money is from the better-off; the polling shows this would be popular”.

Apart from the wealthy, the Treasury also reportedly plans to target businesses, pensions, and foreign aid to raise the capital gains tax and corporation tax, which will form “the centrepiece of the budget in November”.

Sunak is currently mulling over increasing the corporation tax from 19% to 24% in order to boost revenue by £12 billion ($16 billion) next year, and £17 billion ($22 billion) in 2023/24.

According to The Sunday Times, the move will most likely put the government “on a collision course with businesses” hit by the coronavirus pandemic.

Business Leaders Bash Hancock for Second Lockdown Warning

The developments come after UK business leaders slammed Health Secretary Matt Hancock for warning of a possible second lockdown, which they said risks causing “untold damage” to businesses trying to cope with the consequences of the first one.

Leading City financier Dame Helena Morrissey told The Daily Mail on Saturday that she finds Hancock’s warning “very frustrating” and “incredibly inconsistent”.

‘I’m really not sure at this stage that the country needs more scaremongering. And I find it very perplexing and very disappointing that he’s putting fear in. Just as children are getting ready to get back to school, this talk of a second wave is very dangerous. I think that Matt Hancock seems to be marching to his own tune”, she pointed out.

Morrissey was echoed by Charlie Mullins, founder of London firm Pimlico Plumbers, who was quoted by the Daily Mail as saying that “if we don’t go back to work, we’re all going to be worse off anyhow because obviously there won’t be jobs to go to”.

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This followed Hancock’s interview with The Times, in which he, in particular, dubbed a potential new wave of COVID-19 as a “very serious threat” and claimed it could lead to another nationwide lockdown.

He underscored that a second wave in the UK could be "avoidable but it's not easy", given that schools are reopening already next week, which may become a new challenge in tackling the spread of COVID-19.