Today's Money section of The Telegraph features a timely article from our Founder, James Scott-Hopkins, with predictions of the possible measures Andy Burnham might implement to increase the tax take. Please click the link for the full article which can be viewed by subscribers to The Telegraph: James Scott-Hopkins

‍

In Summary:

With another Budget approaching, the familiar question is back: how much more tax can the government extract before taxpayers change their behaviour altogether?

‍

The article compares Burnham's likely measures to Jean-Baptiste Colbert’s famous description of taxation as the art of “plucking the goose” while producing the least possible “hissing”. James's contention is that Burnham has stopped listening to the noise. Rather than asking whether Britain’s tax burden is already changing the decisions of entrepreneurs, investors and wealthy families, the temptation appears to be simply to pluck a little harder.

‍

Take the much-discussed wealth tax. It sounds straightforward enough until you consider what constitutes wealth and, crucially, how it should be valued. Shares quoted on an exchange have an obvious price; private businesses, houses, art and other assets do not. As James says, “Perhaps homeowners will go to extraordinary lengths to devalue their property, or maybe drink their wine cellars dry, or better still, divide their estate between their children and grandchildren.” A wealth tax would therefore be costly to administer while encouraging precisely the sort of tax planning its proponents hope to prevent.

‍

There is also the question of whether the people being targeted will still be here to pay it. Britain has already abolished the non-dom regime and extended inheritance tax to overseas assets for long-term residents. For internationally mobile individuals, these changes matter. As the article puts it, “there are now far fewer of those very people they wanted to tax.”

‍

The same argument applies to Capital Gains Tax. Raising CGT may be politically easier than raising income tax, but the article asks readers to consider what it means for someone who has spent years building a business, employing people and risking their own capital. If the eventual reward for that risk is an ever-larger tax bill, at what point does the incentive disappear? “Why bother,” if success is greeted with “a hefty thank you from the government in the form of higher CGT?”

‍

There is already evidence that taxation affects behaviour. Entrepreneur’s Relief — now Business Asset Disposal Relief — has become steadily less generous. The lifetime allowance was cut from £10 million to £1 million in 2020, while subsequent changes have increased the tax payable on qualifying disposals. According to the article, HMRC figures show that the number claiming the relief fell by 25% between 2018/19 and 2023/24.

‍

That matters because taxpayers are not passive. Faced with higher rates, business owners can postpone a sale, restructure their affairs or move elsewhere. Wealthy families can do much the same. Even HMRC factors behavioural changes into its calculations.

‍

The wider argument, then, is not simply that people dislike paying tax. It is that there is a point at which higher taxation begins to undermine the activity from which future tax revenues must ultimately come. Britain needs people willing to invest, start companies, employ others and take risks. If the tax system increasingly penalises them for doing so, some will decide that the rewards no longer justify the effort — or that those efforts are better pursued elsewhere.

‍

Returning to Colbert’s goose. The danger is not merely that taxpayers will hiss more loudly, but that eventually there will be fewer feathers left to pluck. In its starkest formulation: “Britain simply cannot take any more.”

‍

And if policymakers continue to assume otherwise: “the economy won’t just hiss – it will revolt.”

‍

‍

A summary of the full article written by James Scott-Hopkins for The Telegraph and published 27/08/2026.

The views expressed are those of the author and not intended as advice or a recommendation.