We asked landlords if they should be paying a wealth tax

“The ones that have got yachts can sail out of here tomorrow, you won’t see them again and you won’t get any tax off them.” 

There can be no doubt that just 12-months into their first government in 14-years, Labour are in crisis. 

Elected with a landslide majority on the promise of strong competent government, Labour have so far struggled to pass any landmark legislation.

A partial U-turn on a plan to cut Winter Fuel Allowance payments to most pensioners has been quickly followed by a heavy defeat on a proposed cut to public spending on welfare. 

The welfare bill — which would have saved as much as £5.5 billion by reducing access to Personal Independence Payments —  faced a major backbench rebellion and had to be massively watered down to pass through the House of Commons. 

Now, with the government facing increasing pressure to meet financial targets and Chancellor Rachel Reeves said to be fighting for her job, it is widely expected that Labour will soon initiate a Wealth Tax to recoup some of the estimated £9.9 billion of savings those two cuts would have brought about. 

Viewed as a last resort to begin growing the economy, the tax would likely make up a key part of this year’s Autumn Budget. 

While the plan is yet to be confirmed, Kier Starmer’s official spokesperson recently added fuel to the fire saying: “The Prime Minister has repeatedly said those with the broadest shoulders should carry the largest burden."

The premise behind such a tax is in redistributing wealth more fairly away from a few ultra-rich individuals to the rest of society. 

It’s a direct levy on all owned assets like companies and property, instead of annual income alone. 

While a wealth tax has never been introduced in the UK, they are used to positive effect by governments in Spain and Norway.

The move has been favoured by ex-Labour leader Lord Kinnock who estimates the bill would raise at least £11 billion while sending a vital message to the public, that Labour “are the government of equity.”

Those claims have been backed by wealth tax campaign group Tax Justice UK. They estimate the tax would effect just 20,000 people which is less than 0.04% of the population all while raising £24bn a year.

As a result of the small number of people implicated, there would also be very low administrative costs, making it much easier for HMRC to collect. 

Critics of the proposed tax include the Institute for Fiscal Studies.

They say that trying to push the very wealthy to provide such a high burden of tax would make the UK a less attractive place to live, causing those expected to pay more to simply leave the country. 

To get to the bottom of what a wealth tax would really mean to those affected, JOE Special Correspondent Ed Campbell spoke to a number of Britain’s landlords.

Because landlords rely on property assets — which tend to be priced and valued higher than their fundamental or intrinsic value — for their income, they are set to be uniquely implicated by the tax change. 

Ed visited the National Landlord Investment Show at Old Billingsgate in London to ask landlords if they should pay a wealth tax. 

A representative for the Portfolio Landlord’s Action Network — a small group of landlords that own at least 75 properties each — said, “Many groups that don’t like landlords say: ‘Oh you’re just a parasite.’ You get a lot of abusive comments: ‘you just sit there and collect the money’ but it’s not like that at all, you’ve got huge responsibilities. 

“It is very hard work and that’s why I say that if it’s made such hard work that there’s no profit in it, then people are just going to leave.” 

One landlord said that he had a number of friends who were “leaving the country in droves” in response to the threat of increased taxation on the wealthy. 

He said, “The ones that have got yachts, they can sail out of here tomorrow, you won’t see them again and you won’t get any tax off them.” 

“They’re the ones who create wealth, if you get rid of them, then you won’t get the tax you think you’re gonna get.” 

When challenged on his perspective that the richest would rather leave that pay their share of tax — a recent study puts the exodus rate of millionaires at just 1% —   the landlord said: “They [the Government] think the people leaving are all billionaires. 

“Genuine people who have made a few million pounds have decided they don’t want to stay. Those people probably spend £100,000 a year. 

“They’re not multi-millionaires, they’re decent people that have worked hard to make some money for their families and they’re the ones that are being penalised and they’re the ones that are leaving. It’s not good for the UK.”

With younger people currently paying record levels of income tax, and many millennials paying as much as 50% of their annual salary on rent, Ed suggested to his interviewee it may be time for wealthier individuals like landlords to take on more of a burden. 

The landlord responded: “Some young people should get off their arse and get a job then.

“[For those in work] I agree it’s not great.” 

One couple who said they owned ‘a couple’ of properties, said they feared a wealth tax, as well as new renter’s rights legislation, would force them to cease operations: “We can’t afford to stay in the sector. Anything we make on the rent ultimately most of it goes back in the properties.” 

“The big companies that own hundreds and thousands of properties will manage and I expect they’ll scoop up all the properties that go on the market from people like us.”