Next CEO sells £29m stake as capital gains tax changes loom under Reeves
Next chief executive Lord Wolfson has sold £29m to the giant ahead of potential changes to the capital gains tax (CGT) system, expected in Chancellor Rachel Reeves’ first Budget next month.
The new filing revealed that the Conservative peer offloaded 290,000 shares between Friday and Tuesday, valuing it at a total of £29.2m. Prior to this sale, Lord Wolfson held approximately 1.4 million shares, equivalent to a 1.2% stake in Next, valued at £141m.
The company declined to comment on the sale. After the announcement, the following shares fell by 2%.
The timing of the sale has raised speculation, as Reeves is expected to hint at CGT in his forthcoming Budget, which may include it in the income tax rate. Currently, high earners pay up to 45% on income but are subject to CGT rates of 20% on assets such as shares and 24% on property gains. Basic rate taxpayers face 10% and 18%, respectively.
Many investors were in a rush to sell assets before the changes took effect. Duncan Mitchell-Innes of TWM Solicitors commented, “With many anticipating an increase in CGT, we have seen an increase in property sales in recent weeks.”
HMRC recorded its highest August CGT receipts since 2008, with £197m paid to landlords and investors who want to offload property while they wait for the tax increase.
The latest sale marks the third time Lord Wolfson has reduced his stake, which now leaves him with a stake worth around £100m. The release follows a dramatic rally in Next’s share price, which is up 123% since October 2022.
Next’s performance outpaced many of its competitors, bolstered by a series of profitable improvements. Earlier this month, the retailer raised its profit forecast by £15m, with pre-tax profits expected to reach just under £1bn, boosted by growing international sales.
The company has cited the convergence of global fashion trends, driven by popular trends through streaming services such as Netflix and TikTok, as a key driver of its success.
