Introducing the higher 28% rate of Capital Gains Tax (CGT), together with raising the entrepreneurs' relief lifetime limit from £2 million to £5 million, was forecast to raise £925 million by 2014-15 at the time of the June 2010 Budget. This costing included an assessment of the behavioural effects on CGT receipts, as well as the positive effect on income tax receipts. The policy costings document published alongside the 2010 Emergency Budget Report sets out the methodology for arriving at such estimates and the likely effects on revenue. This document is available on the HM Treasury website1.
It is not possible to separate the impact of the measure from other factors affecting CGT receipts in the outturn. The yield from the measure after taking account of these behavioural responses and the timing of income tax receipts is shown in the following table.
|Post-behavioural Exchequer impact (£m)|
No further estimates of the effect of raising the capital gains tax rate for those gains which qualify for the higher rate have been made.