The Overton window is a political concept that describes the narrow range of ideas that are open for public debate. Whether we should send more tanks to Ukraine, for example, is up for discussion. On the other hand, asking the Coldstream Guards to go in and retake Crimea is not even up for discussion.
In recent memory, the prospect of levying a wealth tax in the UK has been sitting just outside the window. There’s never been a recurring wealth tax here. The last serious proposal was by the 1974 Labour government, which pledged an annual levy on the rich, but it was abandoned by then-chancellor Denis Healey, who said: ‘In five years I found it impossible to draft one which would yield enough revenue to be worth the administrative cost and political hassle.’
Only three OECD nations impose a wealth tax – Spain, Norway and Switzerland – each in a minor way with many exemptions.
But the window can shift. Lately wealth taxes have been creeping into newspaper columns and podcasts. The lobby group Tax Justice UK found 30 economists to sign a letter calling for a tax of 1-2 per cent on assets of more than £10 million, which it was claimed would raise £22 billion a year. Former City trader turned campaigner Gary Stevenson broadcasts his demands for a wealth tax to his 1.4 million YouTube subscribers. The Green Party, Oxfam, Christian Aid and the Equality Trust are in support. An early day motion in the House of Commons in the summer, asking for a tax of 2 per cent on assets over £10 million, was signed by 31 MPs.
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The man doing more than anyone to drag the window leftwards is Arun Advani. A professor of economics at the University of Warwick and one of two directors of the recently created Centre for the Analysis of Taxation (CenTax), Advani is giving new life to the idea. While others deal in catchphrases, he is doing the research. And he has a track record of turning ideas into policy. It was Advani who first suggested removing inheritance tax relief on farms, which is now government policy. He was an advocate for inheritance tax changes for non-doms, also adopted by the chancellor. He’s seen as persuasive and moderate – not least in his view that annual wealth taxes usually don’t work.
In 2020 Advani created the Wealth Tax Commission with Andy Summers of the LSE and barrister Emma Chamberlain. The trio acknowledged that annual wealth taxes are costly to administer, create economic anomalies and can be self-defeating (as the rich flee). Their solution was a one-off wealth tax that would be levied on the value of an individual’s assets, as assessed on a particular date. Those affected could pay off the sum over subsequent years.
The Commission claimed a one-off wealth tax of 5 per cent payable on all individual wealth above £500,000 (charged at 1 per cent a year for five years) would raise £260 billion; at a threshold of £2 million, it would raise £80 billion.
The report is now a core text of the wealth tax debate. It also marked the entry of Advani into the mainstream media, with columns in the Guardian and New Statesman, plus podcast interviews and even an appearance on BBC farming show Countryfile to talk tax.
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An academic with impeccable credentials, Advani (who declined to be interviewed for this article) graduated with a first in economics from Cambridge in 2009, then went on to a PhD at UCL and a professorship at Warwick. He’s won at least 25 research grants, including £2 million from the state fund UK Research & Innovation and £1 million from the Economic and Social Research Council.
He’s prolific, both in the quantity of his output and astonishing variety of his guest roles. He is co-chair of Discover Economics, the industry body that aims to increase the diversity of economics students, which is backed by the Bank of England. He popped up at the government’s Office for Tax Simplification as an adviser, served on the Skills and Productivity Board, is a council member of the Royal Economic Society and a fellow of the World Inequality Lab, and sits on the editorial board of Economics Observatory, one of the industry’s leading publishing platforms. Add in another dozen positions he’s held and you get a feel for his long, distinguished CV.
What’s more, Advani has risen to prominence from relatively humble beginnings. Last year he gave a moving interview with Warwick University’s student magazine The Boar, in which he discussed the example set by his Indian parents, saying: ‘I think my parents worked hard. But however hard they would have worked in India, we would never have had the same levels of income if I grew up where they had grown up.’ He has become an advocate for widening participation in economics among women and people of low socioeconomic status, speaking in schools and running an annual Young Economist competition.
In 2023 Advani got his biggest role yet, when he was appointed to the Office for Budget Responsibility (OBR) advisory panel, where he sits alongside 24 other academics, economists and industry specialists to run economic forecasting and evaluate the government’s performance. It’s a crow’s nest from which to survey the political landscape, while helping to shape the OBR’s policy on government spending.
But in reaching such lofty heights, it’s possible to become a target. Over the summer his views were covered widely, including in the Daily Telegraph, Daily Mail and Bloomberg, when Advani said it had been a ‘mistake’ to introduce non-dom inheritance tax changes he proposed without staggering the introduction to soften the blow.
In July, business secretary Jonathan Reynolds ordered Labour MPs to forget their ‘daft’ demands for a ‘magic wealth tax’, telling backbenchers to ‘be serious’. Shadow business secretary Andrew Griffith said: ‘Arun Advani should be hiding in shame, not dreaming up new ways for this socialist chancellor to set fire to the wreckage that remains of the economy on her watch.’ But Advani is playing the long game.
Positioning himself as a credentialed academic rather than an ideological campaigner – although he is arguably both at once – he’s making the case for a wealth tax, gaining a media profile, building momentum and maybe even moving the Overton window too. As he told the interviewer from the student paper at Warwick: ‘If you want to change the world, and you want to change policy in the UK, be an economist.’
