In the following article, Alex Pugh, Chartered Financial Planner and Partner at wealth management firm Saltus, explains why higher earners may have cause for concern over an Andy Burnham premiership.
Following the resignation of Prime Minister Keir Starmer on Monday 22nd June, attention has quickly turned to the race to replace him – with Andy Burnham emerging as the clear frontrunner.
With no confirmed challengers yet formally entering the contest, Andy Burnham is widely expected to secure the Labour leadership unopposed, raising the prospect that he could become prime minister within weeks if a significant contest fails to materialise.
In his first major speech since launching his bid, delivered on 29th June, Andy Burnham set out plans for what he called “the biggest rebalancing of power our country has seen”, including expanding the Prime Minister’s office to Manchester under the banner of “No 10 North”, promising the biggest council house building programme since the post-war period, and pledging major reform of business rates to revive high streets.
Notably, Andy Burnham committed to operating within the existing fiscal rules and promised “sound public finances.”
One of the most closely watched decisions in the coming weeks will be his choice of Chancellor. Rachel Reeves is widely expected to leave the Treasury, and three names are currently in the frame to replace her.
Wes Streeting, who withdrew from the leadership race to back Andy Burnham, is seen as the most market-friendly option. Ed Miliband, who is politically close to Andy Burnham, brings deep Treasury experience but has faced significant pushback from the business and banking community over his approach to the energy sector as Energy Secretary.
Shabana Mahmood, currently Home Secretary, is seen as a potential compromise candidate who could appeal to different wings of the party.
Each would send a very different signal about how Andy Burnham intends to manage growth, borrowing and fiscal stability – and for anyone with significant assets, the choice of Chancellor will matter as much as the choice of Prime Minister.
Burnham is often regarded as one of Labour’s more business-friendly figures. He has ruled out increases to VAT, employee National Insurance and the basic rate of Income Tax, while supporting measures such as business rate reform for smaller firms.
However, a closer look at his long-standing views on property taxation, wealth, inheritance and the role of the state suggests that affluent households could face significant financial headwinds under a Burnham government.
While his speech focused heavily on devolution and regional growth rather than specific tax measures, the policies he has previously endorsed – and the direction of travel signalled by those around him – remain relevant for anyone with significant assets.
Below, Alex Pugh, chartered financial planner and Partner at wealth manager Saltus, outlines the key risks for high net worth individuals (HNWIs) to look out for.
Introducing a land value tax
Andy Burnham has repeatedly argued that the UK should shift away from taxing property transactions and instead tax property ownership more directly. He has previously said he supports a proposal from campaign group Fairer Share, which suggests replacing both Council Tax and Stamp Duty with a land value tax based on a property’s value.
Homeowners would pay a flat annual rate of 0.48% based on the current market value of their property, rising to 0.96% for empty properties, second homes, and those owned by non-UK residents.
Crucially, the proposal also recommends that the tax is collected from property owners rather than tenants – a significant shift from the current council tax system. For landlords and property investors, this would introduce a direct annual cost on every property in their portfolio that currently sits with the tenant.
In his speech, Andy Burnham did not address the land value tax proposal directly, but his broader view for devolution, including giving mayors greater control over housing and local taxation, suggests that property tax reform remains firmly on the agenda.
Alex Pugh said: “Many wealthy individuals hold a substantial proportion of their assets in residential property. Moving from a transaction-based tax system to an annual property wealth tax would fundamentally change how that wealth is taxed.
While removing Stamp Duty may benefit those buying and selling homes, a recurring levy based on property values could significantly increase annual costs for all homeowners, while those with high-value homes, second properties and investment portfolios could see costs soar.
There is also a human cost that is easy to overlook. Many people have inherited family homes that are now worth significant amounts on paper, but that doesn’t mean they have the income to support an annual tax bill based on that value.
An annual property levy could force people who are asset-rich but cash-poor into selling homes that have been in their families for generations, not because they want to but because they simply cannot afford to keep them.
There is also a broader concern that introducing a tax of this nature could weigh on house prices, particularly in areas where property values have historically been strongest. For investors and families who view property as a long-term store of wealth, that creates an additional layer of uncertainty.”
Re-introducing 50p additional income tax
In September 2025, Andy Burnham said there is “definitely a case” for restoring the 50p additional rate of Income Tax for top earners and advocated Income Tax cuts for lower earners.
Alex Pugh said: “Although Andy Burnham has ruled out increases to the main rates of Income Tax, his comments suggest he remains open to asking those with the highest incomes to contribute more.
“For business owners, professionals and senior executives, the concern is not simply whether a 50p rate returns, but the wider direction of travel. Successive changes to tax thresholds, allowances and reliefs can have a meaningful impact on net income, even where headline rates appear unchanged.”
Raising Capital gains tax
Andy Burnham has not made any specific pledges on Capital Gains Tax (CGT), but it is likely to become a key area of focus under any broader shift towards taxing wealth and investment returns more heavily. The risk around CGT could be amplified significantly depending on which Chancellor he appoints.
Wes Streeting has previously advocated for a “wealth tax that works” by bringing CGT into line with Income Tax rates, arguing that the current system “is not fair and it’s bad for our economy”, signalling a clear appetite for reform.
Ed Miliband’s track record suggests a willingness to intervene in markets where he sees structural unfairness, which could extend to investment taxation.
Alex Pugh said: “Capital Gains Tax has already been subject to significant change in recent years, particularly through reductions in allowances and ongoing speculation about closer alignment with Income Tax rates.
For higher net worth individuals and business owners, CGT is one of the most sensitive areas of the tax system because it directly affects investment decisions, business exits and long-term portfolio planning.
The risk is therefore not just incremental change, but a clearer policy push towards treating capital gains more like income. That could mean further reductions in reliefs, tighter allowances and a more explicit move towards Income Tax alignment, all of which would increase the effective tax burden on investment gains over time.
Such a move would also be seen as detrimental to investment and growth in the UK, disincentivising both domestic entrepreneurship and making the UK a weaker option for global capital in what is a highly competitive landscape.”
Bringing in a ‘social care levy’
As well as expressing support for more wealth-based taxation, Andy Burnham has also talked about replacing Inheritance Tax with a social care levy charged on inherited assets, which would have a significant impact on estate planning strategies.
Alex Pugh said: “Inheritance Tax planning already faces a period of significant change, particularly with pensions due to form part of many estates for Inheritance Tax purposes from 2027.
Any move to replace Inheritance Tax with a different levy may sound attractive politically, but for families it introduces another period of uncertainty. The practical impact would depend entirely on how any replacement system was structured.
More broadly, investors tend to dislike uncertainty around wealth taxation because it can affect long-term financial planning decisions. Whether it’s Capital Gains Tax, Inheritance Tax or broader wealth-based measures, the lack of clarity can often be as damaging as the tax increase itself.
Nationalisation of key services
Andy Burnham is a vocal advocate for greater public involvement in sectors such as transport and utilities, and as mayor of Greater Manchester, introduced the “Bee Network”, which brought local bus services back under public control for the first time in decades.
His speech signalled a significantly expanded role for the state, with pledges for greater regional control of water, housing, energy and transport.
Charlie Ambler, Co-Chief Investment Officer at Saltus, said: “Financial markets generally reward predictability. Investors want confidence that fiscal policy is stable, government borrowing remains sustainable, and the rules of the game are unlikely to change unexpectedly.
“Any perception of greater state intervention, higher borrowing or significant structural tax reform can create market uncertainty, particularly in the short term. That doesn’t necessarily mean markets react negatively over the long run, but periods of policy transition often increase volatility.
For higher net worth individuals with large investment portfolios, that uncertainty is something worth monitoring closely.”
A general shift from taxing earnings to assets
Alex concludes: “The key point here is that a Burnham premiership is more likely to shift the tax burden from earnings towards assets.
His speech this week was deliberately focused on growth, devolution and opportunity rather than specific tax measures – and the markets clearly took some comfort from his commitment to existing fiscal rules.
But the detail will follow, and the direction of travel he has set out across property, public services and regional spending suggests the tax environment for wealthier households is likely to become more challenging, rather than less.
Obviously, at this stage, it is all speculative – he is not the Prime Minister yet, and even if he takes office in the next few weeks, as is widely expected, it is unlikely any radical policies would come into play any time soon.
However, Andy Burnham’s track record – and the rhetoric of those around him – does suggest that individuals with significant property, investments, businesses, and inherited wealth could face a more challenging tax environment in the years ahead.”
