Chancellor Jeremy Hunt has announced the annual exempt amount for capital gains tax is to be cut next year.
The current amount of £12,300 will be reduced to £6,000 next year, before sinking to £3,000 from April 2024.
Mr Hunt said “difficult decisions” are being made on tax-free allowances as he outlined his economic plan for the country in the Autumn Statement.
Speaking on capital gains, the Chancellor said: “The annual exempt amount for capitalgains tax will be cut from £12,300 to £6,000 next year and then to £3,000 from April 2024.
“These changes still leave us with more generous allowances overall than countries like Germany, Ireland, France, and Canada.”
Mr Hunt conceded that his decisions have resulted in a “substantial tax increase,” but insisted headline rates of taxation have not been raised, adding tax as a percentage of GDP will increase by 1 percent over the next five years.
Jeremy Hunt set out the cut in today's Autumn Statement. James Manning
Social media users have taken to Twitter to comment on the change, with Green Party MP Caroline Lucas stating: “Hunt boasting that our allowances for capital gains are more generous than Germany, France and others isn’t something to be proud of.
“We should be taxing wealth more - wealth inequality is still massive.”
Some have hit out at the decision, with one user commenting: “It has officially become a crime to succeed in the UK.”
Another added: “If only it was just the rich that pay capital gains.”
A further Twitter user commented: “Ridiculous changes.”
Mr Hunt said repairing the nation’s finances involved “taking difficult decisions”.
He told MPs: “Anyone who says there are easy answers is not being straight with the British people: some argue for spending cuts, but that would not be compatible with high-quality public services.
“Others say savings should be found by increasing taxes, but Conservatives know that high tax economies damage enterprise and erode freedom.
“We want low taxes and sound money. But sound money has to come first because inflation eats away at the pound in people’s pockets even more insidiously than taxes.
“So, with just under half of the £55 billion consolidation coming from tax, and just over half from spending, this is a balanced plan for stability.”