In short
The episode debates whether the UK should introduce a wealth tax on the super-rich, and what such a tax would look like. Dale Vince, an ex-traveller and green energy magnate who founded Ecotricity (and runs a vegan, carbon-neutral football club), argues the tax system is unjust: people on jobs face ~50% effective tax while those making money from money pay far less. He claims a 2% wealth tax on assets above £10m could raise about £10–11bn/year, and he rejects “they’ll leave” arguments, calling it immoral to cut benefits for poorer people instead. He also proposes taxing non-doms consistently and even suggests citizenship renunciation should end tax avoidance. Economics professor Aaron Advani (University of Warwick) explains wealth tax mechanics (net wealth above a threshold) and argues thresholds should be high (e.g., £10m) due to valuation difficulties for intangible business wealth. He cites evidence that low-threshold wealth taxes have underperformed abroad, and says fixing capital gains tax could raise ~£11–12bn more quickly.
Notable examples
Ecotricity valuation cited via Sunday Times; US-style citizenship taxation; UK non-dom regime created in 1799; capital gains avoidance via dissolving companies.
Written by AI. May contain mistakes. Listen to the episode to check what was said.
Chapters
Tap a time to open that second in VODale Vince: Life as a Millionaire
0:45 to 2:34
Dale Vince shares his background, wealth, and lifestyle choices.
“I mean, how does it actually translate to your life?”
Advocating for a Wealth Tax
2:34 to 3:39
Dale discusses why he supports a wealth tax and its potential benefits.
“Del Vence, how did you get to where you are today?”
Experiencing Poverty and Empathy
3:39 to 4:25
Dale reflects on his past experiences with poverty and their influence on his views.
“In my first book, five years ago now, I called out some of the inequalities in our tax system, such as if you have a job, you're going to pay an effective rate of tax about 50%.”
The Coalition of Patriotic Millionaires
4:25 to 5:55
Dale talks about the Patriotic Millionaires group and their push for a wealth tax.
“And it doesn't give people the chance to fulfil their true potential, which is good for the whole country.”
The Argument Against Wealth Tax
5:55 to 7:49
Dale discusses the arguments against a wealth tax and his counterpoints.
“Okay, so tell me about your fellow millionaires and where they stand, because you're part of a coalition called Patriotic Millionaires.”
Understanding Wealth Tax
7:49 to 9:00
Economics professor Aaron Advani explains what a wealth tax is and how it works.
“Aaron Advani, you're an economics professor at the University of Warwick and the foremost expert on tax.”
Wealth Tax Implementation Challenges
9:00 to 10:39
Aaron outlines challenges in implementing a wealth tax for wealthy individuals.
“And the way wealth tax works is it says, let's stack all of that stuff up.”
Proposed Wealth Tax Rates and Potential Revenue
10:39 to 12:32
Discussion on potential wealth tax rates and how much revenue they could generate.
“That's actually one of the key things about why people have been calling for, if there's a wealth tax, it to be at a very high threshold.”
International Perspectives on Wealth Tax
12:32 to 14:00
Aaron discusses how other countries have implemented wealth taxes and their effectiveness.
“And how much could it potentially raise for the public coffers in Britain?”
Understanding Wealth Inequality in the UK
14:00 to 16:49
Explores the concentration of wealth in the UK and its implications.
“we think it would be a mistake to have a wealth tax of that sort, of the sort that starts at a low threshold.”
Show all 13 chapters
The Challenges of Implementing a Wealth Tax
16:50 to 19:42
Discusses the complexities and existing tax issues surrounding wealth taxation.
“Well, let's talk about government policy then, because one could argue that at the moment, Labour seem to be really good at disappointing everyone.”
The Impact of Super Rich Leaving England
19:43 to 23:26
Examines the potential consequences of wealthy individuals leaving the UK.
“I think fixing some of those problems would be faster and easier.”
Advising on Wealth Tax Reforms
23:27 to 26:10
Offers insights on what reforms could improve the wealth tax system.
“How much of a worry do you think that actually is for the economy and for the government?”
Transcript
Automatic transcript. May contain errors.0:00Arun Advani:This is The Guardian.
0:07Today, a wealth tax.
0:10Dale Vince:What is it and should Labour introduce one?
0:18Arun Advani:My name is Dale Vince and I'm an ex-traveller turned green energy magnate. I run a football club. I do a whole bunch of different things and I campaign for a wealth tax.
0:29Dale Vince:Dale, can I ask, how much are you actually worth?
0:32Arun Advani:Well, I don't know, but if you believe the Sunday Times, they say 100 million or so. They base that on the value of ecotricity, our main company.
0:42Dale Vince:How does it feel to be that rich? I mean, how does it actually translate to your life?
0:48Arun Advani:That's a good question. I mean, it's all relative, right? I own about 200 grand a year. And, you know, I think I live a fairly simple life. I mean, I have a house, have an electric motorbike, have an electric car. I don't fly, but I do go abroad, take train trips. I quite like Cornwall for a place to go on holiday. I'm vegan, so I eat simply, but well.
1:10Dale Vince:Dale Vince owns an energy company. He funds JustUpOil. He's one of a growing number of British millionaires who are, get this, campaigning to pay more tax. They see it as justice for the tax system. Get the richest people to cough at more money to keep Britain working. This week, it's an idea that's got the press, the public and politicians fired up.
1:37Arun Advani:Even by going for an imposition of 2 % on asset values above 10 million, say, which is a very big fortune, the government would be in a position to collect 10 or 11 billion a year. Growing numbers of people are joining calls for a wealth tax on the super rich. So will the Prime Minister stand by his promise that those with the broadest shoulders should carry the largest burden? Let's be honest about what that means. This is a tax on all of our constituent savings, on their houses, on their pensions. It would be a tax on aspiration.
2:15Dale Vince:Could it work? And would it make society fairer? From The Guardian, I'm Nisheen Iqbal. Today in Focus, is it time to make the super rich pay?
2:34Del Vence, how did you get to where you are today?
2:37Arun Advani:I spent my life dedicated to my mission, which is to bring sustainability to Britain. And in the course of that, I built a group of companies, the main one being Ecotricity, with the Green Britain Group.
2:46Dale Vince:But you really put your money where your mouth is. I mean, you also have the world's first vegan, green, sustainable, carbon neutral football club.
2:55Arun Advani:Yes, all of those things. Greenest on the planet, according to the UN, which is quite nice of them to say. But yeah, I mean, I do, you know, I'm genuine about how I feel about sustainability, the need to change the world, starting with our country, really, to make it a better place, not just a green place, but a place where we have social justice and we end poverty and a place where we do business in a better way. Dale, following a difficult couple of weeks for the government in which they've struggled to show voters and the markets that they actually have the public finances under control, it's in this space that the idea of a wealth tax has really been pushed on the public agenda.
3:33Dale Vince:Now, you're a multimillionaire. Why are you one of the people advocating for it?
3:38Arun Advani:Well, you know, I've been campaigning for this for a little while. In my first book, five years ago now, I called out some of the inequalities in our tax system, such as if you have a job, you're going to pay an effective rate of tax about 50%. But if you make money with money, then your tax rate is about half of that. So there's a big disparity between people with a job and people with money in terms of the tax system. It's absurdly complex as well. I think we could simplify it and we could bring some justice to the tax system, which entrenches poverty and entrenches wealth at the same time. And I just think it's wrong.
4:13Arun Advani:With millions of people living in poverty, I think it's actually a bad economic choice, not just a bad moral choice, because people have a bad start in life when they grow up in poverty, in families that can't feed them and that kind of stuff. It's a bad start in life. And it doesn't give people the chance to fulfil their true potential, which is good for the whole country.
4:31Dale Vince:Well, does it feel incongruous then? Because you do obviously have a social conscience and you care about social inequality but do you feel a sort of dissonance between what you have you know being so rich and what the people you're fighting for what they lack well i suppose in my life experience
4:54Arun Advani:is having been um homeless briefly um and um lived on lived on the road for 10 years so i I wasn't actually homeless. I had vehicles I lived in and stuff like that. But, you know, I lived in a world where I could make five pounds a day faux busking to support myself. And so, you know, I've been in a place where everything wore out. My shoes fell off my feet and some wonderful person in Spain gave me some shoes. So I've been there. So I guess maybe I have empathy in that respect. But no, I don't feel a dissonance. What I'm more interested in is how to change things. And actually, there's something curiously useful about being a rich person calling for more tax on the rich, because normally it would be a lefty thing.
5:40Arun Advani:It would be a politics of envy, perceived at least kind of thing. And it's not. There's a whole bunch of us. We're all saying the same thing, that we can afford to pay more tax. Rich people should pay more tax and we can use that money to reduce inequality in our country. So I don't feel dissonance. I feel enabled.
5:57Dale Vince:Okay, so tell me about your fellow millionaires and where they stand, because you're part of a coalition called Patriotic Millionaires.
6:04Arun Advani:Yeah, it's called Patriotic Millionaires. They've done a fantastic job because they've really put wealth tax on the agenda. You know, Neil Kinnick called for them a couple of days ago, for example. Lots of Labour MPs are now calling for them. We've got this funding crisis. We're having to look to cut the benefits from people that really need them. What I'm calling for is a welfare tax for the rich, because it's a different form of welfare. If you look at the exemptions, the allowances and all of that kind of stuff, it's for people with money to have more money. That's welfare, in my opinion.
6:30Dale Vince:And to put patriotic millionaires aside for a moment, because I think it's fair to say that most mega wealthy people don't want to pay more tax. And they're the ones you hear a lot from right now saying, we're going to leave the country and we're going to take our wealth with us. And ultimately, the idea of a wealth tax to them is a really terrible one. What do you think about their argument? and how important do you think they are to the way Britain functions?
6:56Arun Advani:Well, I think that it's immoral of us if we don't take action to equalise the tax system because we're afraid there are rich people who can afford lawyers and accountants and who may leave the country because they may do that. It's immoral of us to say, well, that's fine. We'll instead make cuts to benefits and we'll increase taxes for the poorer people in our country because they have no choice because they can't go anywhere. That's my first point. It's immoral. My second point is I think it's overdone. I don't believe it. But there's been a number of reports about people leaving since the last budget.
7:30Arun Advani:And I think it was somewhere like 0.3 percent of Britain's millionaires actually have left the country. It was a little bit more than the background level if you look at the last five year average. So I don't think it's happening. My third point is if you don't want to pay tax here, well, fuck off. But we shouldn't let people leave our country and retain citizenship. ship we should take it from them to solve this problem we should adopt a system like the united states it doesn't matter where you live in the world if you're a united states citizen you pay tax to your home country we should drop the same system then the only way you avoid paying tax here is to renounce citizenship which is a great benefit to people but they take it for nothing when they leave and go and live in a tax haven which i think is wrong it's immoral they make their money here and then they say oh i can afford to live in a tax haven to save even more money I'm off, thanks for everything.
8:18Arun Advani:I just think it's wrong.
8:26Dale Vince:Aaron Advani, you're an economics professor at the University of Warwick and the foremost expert on tax. So first things first, can you explain to me exactly what a wealth tax is?
8:37Arun Advani:A wealth tax is a tax on the value of all of the things somebody owns take away all the debt. So add up all the things you have. You add up your house or pension. Remember, if you have a house and you share it with a partner and they own some of it, then you're half the value of it. Cash you have in a bank. If you own your stocks and shares, all of that stuff. Add it all up. Take away your mortgage. Take away your credit card debts. And what's left over is your net wealth. That's the total net wealth you have. And the way wealth tax works is it says, let's stack all of that stuff up. Let's draw a line somewhere and say, we'll tax only the bit above that.
9:07Arun Advani:So if you wanted a wealth tax at, say, 10 million pounds, you'd add up all of the wealth that somebody has. and if they have any wealth that goes above£10 million, then only on the bit above£10 million you would apply the tax. That would be what a wealth tax should be.
9:19Dale Vince:And in these current proposals that we've seen sort of floating around, how wealthy do you have to be to be eligible for slash subject to a wealth tax?
9:29Arun Advani:So in principle, wealth tax can apply at any level. If you look at most European wealth taxes, actually they start at relatively low thresholds of wealth. so of the order of say 200-ish thousand pounds in the UK in UK terms that would be quite a lot of people who would have to pay a wealth tax like that but when you look at the countries that have that somewhere like Switzerland has a wealth tax starting at a relatively low threshold but doesn't have a capital gains tax Norway has a wealth tax like that but it doesn't have an inheritance tax and so those taxes are kind of substitutes for taxes we already have and so when you look at what people have been talking about in the UK they're talking at a much much higher threshold So they're talking about a threshold of more like£10 million as the point at which people start paying all wealth tax.
10:14Arun Advani:And at that point, that kind of threshold, you're talking about typically maybe 25-ish thousand people who will be paying that in any given year.
10:23Dale Vince:Aaron, rich people have much more complicated financial arrangements than the rest of us. You know, it's not just a case of slapping a tax on their salary, for instance. They have other assets, you know, properties, stocks, shares, bonds, I don't know, all sorts. So how would a wealth tax work for them?
10:39Arun Advani:That's actually one of the key things about why people have been calling for, if there's a wealth tax, it to be at a very high threshold. So back in 2020, along with Andy Summers and Emma Chamberlain, I ran the Wealth Tax Commission, which looked at whether the UK should have a wealth tax. And one of the things we said was, if you were going to have a wealth tax in the UK, it ought to start at a very high threshold. and the reason for that is that if you have a lowish threshold, one that covers millions of people, one of the problems you have is you have a lot of people for whom you have to get the value of all of their assets.
11:11Arun Advani:Now for cash that's easy, just go look at your bank account. For a pension sure you can get the pension fund to send you something, your house, you know we all have Zoopla so we can figure out what the value of most houses are. But for private businesses specifically that gets really difficult. If I'm a plumber the value of my wealth is pretty much the value of the van I drive around in and the tools that are inside it. And that kind of logic pervades what a lot of countries do, which is when they value businesses, they take what's called book value, the value of the actual tangible physical stuff, you know, stuff that if you drop it, it hurts your foot when it lands on it.
11:41Arun Advani:That's what they typically add up. But when you look at the wealthiest people, the wealth that they have is mostly business wealth. And most of that business wealth is actually intangible stuff, stuff you can't touch. It's the intellectual property, it's the ideas, it's the branding, it's the trademark. All of these things are really important, but actually you can't put a precise value on directly. Now, that doesn't mean they can't be valued. We do know how to value these things, but it's not straightforward. It doesn't take some time and some cost. And so you can't do that for millions of people every single year.
12:12Arun Advani:And that's the rationale for having a high threshold for wealth tax, because you have a small number of people who are covered by the tax. And that becomes a scale where you can actually administer the tax, you can actually value the assets for those people.
12:24Dale Vince:And what would a sensible threshold be? I mean, given the current conversation around wealth tax, what would be a proposed tax rate? And how much could it potentially raise for the public coffers in Britain?
12:37Arun Advani:In terms of what the rate should be, you know, again, that depends on how much you're trying to raise. It does also affect, you know, if you pick very, very high rates, obviously people respond much more drastically than if you pick lower rates. Let's take 1 % as a nice round number, simple example. If you had a 1 % wealth tax on wealth above£10 million, back in 2020, we said that would raise about£10 billion a year. Now that will be slightly bigger because a few years have passed. We know inflation means that these numbers go up. We haven't got a precise number for it since then, but a bit more than£10 billion, maybe£11 billion or something like that.
Read the full transcript
13:08Dale Vince:But twice the figure that the Chancellor is trying to save in the recent welfare reforms.
13:12Arun Advani:Yeah. I mean, certainly it's quite a substantial amount of money. I mean, it's more than putting sort of, you know, when people talk about, you know, other ways of raising money, and some people will say the simplest way to raise money is just to increase the basic way of income tax. Now, that's certainly simple, you know, you can do it on a stroke of a pen. That raises sort of seven, eight billion pounds. So it's more than putting a penny on income tax to do this.
13:31Dale Vince:And so you mentioned that other countries have tried it. Can you tell me about, can you tell me more about those? Which countries have tried a wealth tax and how has it worked out there? Yeah.
13:39Arun Advani:So lots of countries have had something like a wealth tax. They've tended not to work amazingly well because they've tried to cover quite a large share of the population. They've had lowish thresholds. They've done a wealth tax starting at£100 ,000 or£200 ,000 in some equivalent. And so when we did the work at the Wealth Tax Commission, we said, looking at the experience of other countries and learning from that experience, we think it would be a mistake to have a wealth tax of that sort, of the sort that starts at a low threshold. If you want one, the only way you can make one that's going to be actually useful will be to start at a relatively high threshold.
14:15Arun Advani:We don't have an example of other countries having done that yet. That, I think, is because people are still developing how this kind of tax works. I mean, so you shouldn't expect that the first wealth tax bill would be the perfect one.
14:26Dale Vince:And what about the general sense that most people have that there is a wide gap in financial inequity in Britain? And there is a sense that some people are super well off and some people very, very, very far away from that. And I wonder, looking at the hard data, how true or how big is that gap? And how much of the country owns how much of its wealth?
14:47Arun Advani:There are different ways to measure these things because wealth is hard to measure. But I think best estimates are that the top 1 % of the wealth distribution own 14 % to 16 % all wealth. The top 10 % of people own, by our best estimates, more than half of all wealth. but the ONS's current figures are a bit more than 40%. So it is striking how concentrated wealth is. I mean, in some sense, the UK isn't hugely unusual among high-income countries. Those concentrations are something we see mirrored in a lot of places. The wealth tax isn't necessarily the only solution to that kind of thing. In some sense, the wealth tax may not even be the solution to that.
15:28Arun Advani:Because if you think about what some people are calling for of a tax of, say, 1 % on wealth at some very, very high level. I mean, starting at£10 million, you're way into the top 1%. There's lots of people in the top 1 and the top 10 who are not being affected at all. So in that sense, you're not necessarily going to solve that problem.
15:47Dale Vince:But I guess the question is around how that wealth is being shored up. I mean, is the sense that the rich are just getting richer and the poor are just getting poorer? Is that the trajectory? For a while, the wealth concentration
15:58Arun Advani:has been rising slowly. I mean, it's not changing very fast. The level is high in terms of the inequality. The trajectory is actually not that terrible. The thing that makes people feel like it's really bad, and I think it's important to recognize and to think about, is that the fact that the average person's income has not been rising for a really, really long time means that you then feel much more the poverty that comes from the fact that you can't afford things. Inflation's been high, wages haven't always kept up, and that isn't a good situation. So then, you know, when we had good growth, which we had here up until about 2008, everyone's income to some extent was growing.
16:35Arun Advani:Some incomes were growing faster than others. But as long as you felt like you were getting better off, you could maybe accept it. In a world in which you see that your income is definitely not growing, then it's all about trying to work out how do you share the pie that we do have. There's no growing the pie, we're just sharing out the existing pie. And in that case, it does become important to think, is the way in which we're distributing this stuff currently the right one, or should government policy be involved somehow in trying to adjust that distribution to support individuals who can't afford to make some of those basic decisions they need to do, how to heat their homes, how to feed their kids.
17:08Arun Advani:Those things are important.
17:09Dale Vince:Well, let's talk about government policy then, because one could argue that at the moment, Labour seem to be really good at disappointing everyone. I mean, you've got their core supporters who are completely unimpressed with its welfare reforms. You've got everyone else, you know, for their general lack of vision. Now, a wealth tax could start to change that narrative because if you look at polling from YouGo, you know, around 75 % of the country, irrespective of political stripe, would support the idea of a wealth tax and to have the people who could afford more contribute more because it seems fair.
17:43Dale Vince:So why is it that Labour isn't running away with this policy?
17:47Arun Advani:It's a good question. I mean, one thing to say is that a wealth tax does take time. Inventing a new tax is a hard thing. and if a government wanted to do it, suppose the Labour Party wanted to do it and decided as of this evening, they decided this is what we want to do, it would still take a couple of years to actually put that tax in place. Now, that doesn't mean you shouldn't do it, but we should recognise that it's not something that the Chancellor could announce in October and say, yeah, I'm announcing this at the budget and it's going to come in at the start of the next half of the year.
18:12Arun Advani:That's just not achievable at all. And the other thing to say is we have lots of taxes, lots of types of taxes on wealth already and many of these taxes don't work very well at the moment. I mean, capital gains tax at the moment is a complete mess. So capital gains tax is the tax on you own something, it increases in value, and you sell it for more than you bought it for. And we have a much lower rate on that than we have on income tax. But what that means is that people don't just sort of do actual investments to get capital gains. They also, for example, if I'm working as a consultant, I quit my consultancy, set up my own company, private company, through which I am a consultant.
18:50Arun Advani:I get paid into the company, and I keep a lot of the cash in the company. And then what I do one day is just to dissolve the company and liquidate the company. So I'm not even having to find somebody to buy it. And in liquidating the company, I can get that money as a capital gain. So those kinds of problems exist elsewhere in the tax system. So it's not to say that one shouldn't ever have a wealth tax, but if a government was interested in trying to get more money from wealth, they've struggled to actually just fix the existing taxes we have on wealth. And that would seem like the easier place to start because you could do that much more quickly.
19:15Arun Advani:And yet successive governments, the previous government as well, but current government, hasn't managed to solve that kind of problem, which is actually much easier to solve.
19:22Dale Vince:So if I'm understanding it correctly, it's not just that it's complicated and it would take a while for it to be rolled out. It's just the fact that you have all these existing taxes that aren't actually as efficient as they could be and aren't being managed or levied as efficiently as they could be. And so maybe start there before inducing more.
19:41Arun Advani:Exactly. If we were going to try to raise more money from wealth, I think fixing some of those problems would be faster and easier. There's a lot of consensus on that across the political spectrum. And so those seem like much more straightforward things to do that they haven't managed to do.
19:58Dale Vince:Coming up, what would the consequences be if the super rich left Britain?
20:15Dale Vince:Aaron let's talk about the super rich leaving or about non-doms who just just to clarify they're the people who live in Britain but whose permanent residence for tax purposes is outside the UK should the average Britain care if they go yeah exactly it's a really important question
20:33Arun Advani:So there's maybe three reasons you might be interested in the super rich. The first is that they make a direct fiscal contribution. You know, we all pay some tax. People who are super rich will also probably pay some tax. Second thing you might care about is to the extent that some of these people, and genuinely are, you know, there are some scientists who come here and they live around Oxygen Cambridge. There are people who come and work in the oil industry around Aberdeen. There's people who are a sports star and come and live around Manchester. Those people come and they do their thing. They do it really well.
21:01Arun Advani:And that's good. And they also, alongside doing that, enable there to be other jobs alongside them. So if I come as a scientist working in a lab just outside Cambridge, I also might need some lab technicians and I need some other support of people coming to work alongside me. And so there are these other jobs that can be created. And then the third thing you might be interested in is what's the impact of them bringing their wealth and investing? I think that's the most interesting one because people always imagine, well, there's always wealthy people and we want them to come here so they can invest here.
21:30Arun Advani:And they forget that actually the regime that we've designed in the UK, both the old non-dumb regime before the reforms and the new regime that's been introduced, is one that gives wealthy people a tax break as long as they invest anywhere except the UK.
21:44Dale Vince:It's just completely bananas.
21:46Arun Advani:Which sounds completely mad, and it is completely mad, but we give a tax break on investments that you make in France. We give a tax break on investments you make in Germany or Jersey or the Cayman Islands or the US or India or wherever you pick, except the UK. If you invest in the UK specifically, we will tax you on that. And that seems completely backwards.
22:02Dale Vince:But why is that? Why is there this obsession with keeping these kind of super rich people?
22:08Arun Advani:Yeah, and the reason we have this weird tax break that encourages us to bring super rich people here but not bring their wealth here. It comes from the history, essentially, of that regime. That regime wasn't created ever as a tax break. It wasn't created as a way of not having to pay tax. It was created in 1799 as a way in which people who had money out in the colonies didn't have to pay tax until that money came on shore. Because in 1799, there was no MasterCard, there was no Visa, no Amex. So you couldn't just spend the money you had abroad in the UK without coming here. And so essentially, because when I had some sugar cut down from my sugar plantation, technically the income had arisen, but I couldn't spend it.
22:47Arun Advani:We said, we won't tax you on that until you bring it onshore. So it was a deferral of tax until I get the money onshore. And what that turned into was suddenly like, oh, actually, now I can actually just keep my money offshore. Then that's turned it from a tax deferral to actually a tax exemption.
23:03Dale Vince:Aaron, so from 1799 up until 2025, are you seriously telling me that it has been impossible to change, rejig the economic system so that this tax break doesn't exist, one that wasn't even supposed to be here in a modern capitalist society with all the tech that we have?
23:21Arun Advani:Back in 2023 and 2024, people were saying you couldn't even change any of the regime, at least we changed some of it.
23:27Dale Vince:We've been reading all these stories, many of them reported by our colleagues at The Guardian, of the mega wealthy leaving London, you know, of there being this exodus from the city, banks moving their HQs, the money is moving. That seems to be the headline. How much of a worry do you think that actually is for the economy and for the government?
23:44Arun Advani:So there's a couple of things. One is, I think the headlines at this point are certainly premature. And since we really just don't know, that isn't so that nobody is leaving. Certainly you should expect that some people are leaving. Because some people also kind of will read us as saying, like, oh, you know, nobody's ever going to leave. you shouldn't worry about anyone leaving. That's definitely not what I'm saying. If you look at the previous reform, the reform that George Osborne introduced, came in in 2017, what we saw was that before the reform came in, about 4 % of them left the UK every year.
24:13Arun Advani:The year after the reform came in, that jumped up to 10%. So it was a big jump. And then it went down again, and actually went down below the long run average for a couple of years, which was partly because some of the people who were going to leave at some point left a bit sooner than they would have done otherwise.
24:26Dale Vince:Aaron, from where you're sat with all your expertise, if the Chancellor calls you up tomorrow to ask your advice on what to do with the wealth tax, what would you say? I would say if you've got the political capital to make some changes to the taxation of wealth,
24:40Arun Advani:the first things you should deal with are problems in the way that we're taxing capital gains particularly, because I guess in the way of growth and creates a lot of tax avoidance, as well as not raising as much money as it could. If you were to fix capital gains in the way that we've previously proposed. That on its own would raise you 11 to 12 billion pounds. And that's much more straightforward and has very wide political support and could be deliverable much more quickly. And so that is the place that I would start. If you're then still entering the wealth tax, I'd happily walk you through, Chancellor, what the process would look like from here to there.
25:10Arun Advani:But you'd have to expect that there's a runway of a couple of years at least that's going to be the process from here to having a wealth tax like that, if that's what you want.
25:18Dale Vince:And what does the UK stand to gain if the very wealthy of this country were made to contribute a bit more?
25:24Arun Advani:The current fiscal situation, the situation where the government is every single month being harangued for, do we have enough money to pay for all the things that we need, is a terrible one for all of us. People who are benefiting from government services are worried, are those things going to survive? Are we going to see suddenly cuts come into some other area that we hadn't expected? So if the wealthy, they could contribute some more. And we've got the fiscal situation to a state where we weren't continuously speculating on what is the next change going to have to be because the government can't make its numbers add up.
25:55Arun Advani:That would put us all in a position where we could stop having to think so much about tax. As a professor of tax, it's wonderful for me that I get to go on the radio all the time and come on podcasts like yours. But frankly, it would be better for us all if you had to hear much less from me because we weren't excited about tax, because nothing much needed to change and we could all plan for a relatively certain stable future. That would be a much better situation for the entire country.
26:16Dale Vince:Aaron, thank you so much for your time.
26:19Arun Advani:Thanks for having me.
26:21Dale Vince:That was Aaron Advani, Associate Professor in the Economics Department at the University of Warwick. My thanks to him and to Dale Vince. This episode was presented by me, Nosheen Iqbal. It was produced by Ruth Abrahams, Alex Atak and Karis Reid. The executive producer was Huma Khalili. Sound design by Brian McNamara. We'll be back tomorrow.
26:52Arun Advani:This is The Guardian.
