Taxing Crypto to Boost Stocks, UK Banker Says

Lisa Gordon, chair of investment bank Cavendish, says that the UK should start taxing crypto purchases to get people to invest in local stocks. Such an initiative could help the country’s economy.

Gordon told a known newspaper on March 23 that the fact that more than half of people under 45 own crypto but no stocks should scare all of us: “I would like stamp duty applied to crypto and a cut on equities.”

Currently, shares listed on the London Stock Exchange, the country’s largest securities market, are subject to a 0.5% tax. And this tax gives around 3 billion British pounds ($3.9 billion) in annual tax revenue.

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Gordon also said that a tax cut might make people want to invest their savings in UK companies. More UK businesses going public resulting of this would be beneficial for the economy.

She said, drawing comparisons, that cryptocurrency is a “non-productive asset” devoid of any benefit to the national economy.

Companies hire people, start new projects, and pay taxes; thus, they obtain growth capital from stocks. That’s an agreement between people. We shouldn’t be afraid to fight for that.

In November, the country’s Financial Conduct Authority said that 12% of adults, or about 7 million people, now own crypto. There were 36% of crypto owners who were younger than 55 years old.

Gordon said that “many people have switched from investing to saving,” which she said “is not going to pay for a good retirement.”

A survey by the FCA in 2022 found that 70% of adults had a savings account and 38% either owned shares directly or held them through an account that let them save nearly 20,000 British pounds ($26,000) a year tax-free. Three out of four 18–24-year-olds did not have any investments.

But in a follow-up poll, the regulator found that during the year ending in January 2024, the cost of living crisis caused 44% of adults to either stop saving or investing or cut back on it. Furthermore, almost a quarter of adults used their savings or sold their investments to pay for everyday things.

Gordon is a member of the Capital Markets Industry Taskforce, which is made up of business leaders who want to bring the local market back to life, which helps companies plan their stock listings— something Cavendish advises on.

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In January, consulting giant EY said that the London stock market had “one of its quietest years,” with only 18 companies listing last year, even fewer than the 23 companies in 2023.

EY also said that 88 companies took their shares off the exchange or moved them to another one. Many of them said they were leaving because of “declining liquidity and lower valuations compared to other markets,” like the US.

But Gordon said the UK is a “safe haven” compared to markets like the US, whose stock markets have lost trillions of dollars because of President Trump’s tariff threats and worries about a recession.

Along with US stocks, crypto markets have also gone down. For example, Bitcoin (BTC) is trading around $87040, down about 9.77% over the past month and up around 3.36% in the last 24 hours. Although it has recovered above the $85,000 level currently, it battled to keep that support over most of March.

In short, Lisa Gordon wants the UK to tax crypto purchases and cut taxes on company shares to help the country’s stock market grow.

She believes such measures will push more people to invest in UK companies, create jobs, and support the economy. Meanwhile, crypto may be popular, but Gordon says it doesn’t help the country grow or create jobs. Time will tell if her proposal gains ground or just stays within the boardroom.