
Rachel Reeves needs to shut down the conversation regarding a "dangerous" idea immediately, as the UK economy is already suffering, an expert has said. Recent speculation about a possible wealth tax - which it is thought could target the UK's top 1% to 5% of wealth holders - is already having harmful effects, Nigel Green, CEO of global financial advisory giant deVere Group warned. He said: "Every day that the Government fails to rule it out, confidence erodes. Wealth is highly mobile. So are the people who create it. The longer the uncertainty lasts, the more capital quietly moves out of the UK."
Even though no formal policy has yet been announced, Mr Green added that the damage is being done in real time, and the threat alone is enough to spook investors and push entrepreneurs to look elsewhere. "This isn't a theoretical risk," the money specialist said. He continued: "We've already seen a sharp uptick in high-net-worth individuals actively restructuring their assets and exploring overseas residency this year and this speculation will fuel that momentum.
"These aren't people trying to dodge responsibility-they're reacting to what they see as a government warming to the idea of penalising wealth itself."
Introducing a wealth tax would be "self-defeating", Mr Green believes, adding there is international precedent for this viewpoint.
He said: "France, Spain, Norway, Switzerland are some of the countries that have tried some version of a wealth tax.
"In almost every case, it's either been abandoned, heavily diluted, or discredited. The wealthy don't just sit and wait for the government to reach deeper into their pockets-they act; and once they go, it's incredibly difficult to win them back."
It comes amid speculation about the prospect of tax rises in the Chancellor's autumn budget, after she insisted commitments not to increase taxes on "working people" remained.

The Transport Secretary Heidi Alexander said on Sunday that people with "modest incomes" would be protected from hikes, prompting questions about the possibility of a wealth tax, which the Government has not ruled out.
Asked to define "modest" in "salary terms", roads minister Lilian Greenwood said on Tuesday: "I think it means people who earn kind of around average income."
Former Labour leader Lord Neil Kinnock said at the start of this month that Ms Reeves is "bogged down" by her own imposed fiscal rules, a 2% wealth tax would help her get out of that situation.
The policy would also be backed by the "great majority of the general public", he argued.
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