Chancellor John Healey rules out raising capital gains tax ahead of the 28 October Budget
Chancellor John Healey has rejected calls to raise capital gains tax in his first Budget on 28 October, according to BBC News, the Guardian, City AM and the Evening Standard. BBC News says influential Labour figures had been pushing to equalise the tax with income tax, while critics argued this could backfire. The Times, as relayed by Zawya, reported that Mr Healey was warned a higher rate could reduce revenue if wealthy people left Britain or delayed selling assets. Capital gains tax is currently charged at 18% and 24% on most gains. City AM reports investors welcomed the end of the speculation. The Daily Mail says he is targeting banks, and Zawya's report of the Times says a levy on banks will be the main revenue-raising measure, funding a temporary cost-of-living package. Reuters, citing the Financial Times, reported that a smaller increase had been under consideration.
Capital gains tax is one of the few large taxes where the rate alone can change behaviour, because the tax is paid only when an asset is sold. Ruling out equalisation removes a possible source of revenue and shifts the burden to other measures, such as a bank levy, ahead of the Budget.
If you hold shares, funds or a second property, the rates of 18% and 24% are expected to stay for now, but the Budget on 28 October is the date that settles it. Reports differ on whether a smaller change is still possible, so avoid selling purely because of this news.
Backers of the decision, as City AM and the Times report them, say a higher rate could drive investors overseas and cut revenue, so keeping rates steady protects investment.
Labour figures who wanted equalisation, as BBC News describes them, argue that gains are taxed more lightly than earnings, while Conservative leader Kemi Badenoch argues in the Guardian that the Budget will be worse than the last one unless spending is cut.
Confirmed by several outlets: the Chancellor has rejected equalising capital gains tax with income tax. Not confirmed: whether any smaller change is planned, or the size of any bank levy. Watch for the Budget statement on 28 October.
DailyDrop U.K. edition No. 17 · Morning · WED., OCT. 21, 2026