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Labour refuse to rule out support for 'wealth tax' raid on savings

Anneliese Dodds replaced John McDonnell as Shadow Chancellor after the last Labour reshuffle - Stefan Rousseau/PA
Anneliese Dodds replaced John McDonnell as Shadow Chancellor after the last Labour reshuffle - Stefan Rousseau/PA

Labour's shadow chancellor has refused to rule out her party's support for a "wealth tax" on assets to aid the country's coronavirus recovery.

Anneliese Dodds refused seven times to discuss the detail of a policy that could involve taxes on savings or property ownership in the UK to boost the country's public finances.

Speaking on the BBC's Andrew Marr programme and Sky's Sophy Ridge on Sunday, Ms Dodds said the burden of higher taxation ought to fall on those with the "broadest shoulders".

But pressed on what a Labour wealth tax might involve, she said a debate over the policy would take place only if the UK has a severe Covid-19 recession.

"I think, where there needs to be additional funds going into the system, they should be coming from those with the broadest shoulders, and we have seen an increase in income and wealth inequality over recent years," she said.

"I think there's strong public support for where there needs to be that additional contribution, that coming from those with the broadest shoulders."

Her comments come in advance of an economic statement from Rishi Sunak, the Chancellor, on Wednesday.

The "mini-Budget" will allow the Government to set out policy for a coronavirus recovery.

Asked if she was a socialist,  Ms Dodds said she wanted to see a "fairer society".

"We need to change to that," she said.

"Some people would call that socialism; some people would call it fairness.

"What's most important to me is that we actually get that changed that we don't ever enter a crisis again, with so many families in our country struggling."

Ms Dodds has previously said the Government "does need to look at" the idea of a wealth tax, which could see the Treasury raid accounts for taxpayers' savings.

Basic rate taxpayers can currently earn £1,000 of interest on their savings tax-free, and higher-rate taxpayers can earn £500.

Speaking to the BBC's Andrew Marr on Sunday, Ms Dodds said the wealth tax was a "complicated area".

"There's a large number of academics who are looking at this actually, [there are] currently a variety of different proposals," she said.

"And I would really encourage Government to engage with that rather than looking at tax rises, which would affect everyone equally. I don't think that would be fair."

Ms Dodds, who first entered Parliament in the 2017 election, took over the job of Shadow Chancellor from John McDonnell when Sir Keir Starmer entered office as Labour leader.

Labour is widely expected to abandon much of the economic policy developed under Jeremy Corbyn, which called for free broadband, a pensions tax and significant nationalisation of industry.