Question to the HM Treasury:

To ask His Majesty's Government what additional tax revenues would be raised by abolishing the allowance for Capital Gains Tax.

To produce an estimate for the tax revenues raised from the abolition of the Annual Exempt Amount (AEA) on Capital Gains Tax (CGT) would require a disproportionate cost.

Estimates for the tax relief afforded by the AEA can be found in HMRC’s structural tax relief publication [1] . Please note that these estimates do not represent the gain to the Exchequer should the relief be abolished as they do not explicitly model additional behavioural responses or wider economic impacts that could result from changes to the relief. The latest published estimates also reflect the AEA being £12,300 for individuals in 2022/23, compared to the current AEA of £3,000.

You may also be interested in HMRC’s direct effects of illustrative tax changes publication [2] which includes estimates for an illustrative change to the AEA. Please note that these estimates are non-linear and asymmetrical. For example, doubling or halving the AEA estimates will not accurately predict the change in revenue for a proportionate change in the AEA.

[1] https://www.gov.uk/government/statistics/minor-tax-expenditures-and-structural-reliefs/structural-tax-relief-statistics-december-2024

[2] https://www.gov.uk/government/statistics/direct-effects-of-illustrative-tax-changes/direct-effects-of-illustrative-tax-changes-bulletin-january-2025