Indeed, countries like Belgium, the Netherlands and New Zealand have no capital gains tax, and historical evidence shows reductions in capital gains tax rates can lead to increased tax revenues. For instance, when Ireland halved its capital gains tax rate in 1997, revenues doubled within two years.
Mr Young’s modelling suggests that eliminating capital gains tax in the UK could increase national income by 0.9pc annually, equivalent to £2bn, with two-thirds of lost revenue offset by increased tax revenue derived from that higher national income with further revenue increases resulting from higher investment and productivity. DT.
