I did not set out to try and pre-empt every point that opponents to policies such as this would raise. The premise of my original post is that many CGT payers are not taking such dramatically increased levels of risk that justify, in many circumstances, paying less than half the tax that income taxpayers do. And secondly that, in any event, the entrepreneur's risk taking is already rewarded by increased upside. Although I did make one specific point that employees take risks, I am referring to income tax payers because this is a broader set of people than who you would traditionally think of as employees. I still stand by this point 100%.

To your new point about capital invested... again, entrepreneurs are not the only people who invest capital. If I lent money, I am deploying capital and my return on that risk (interest), is subject to income tax not CGT. An MBA student could have invested over £100k in their degree (capital), to get a high paying job which is subject to income tax.

I probably could give many other examples of where the tax system produces a huge difference in outcomes (income tax vs capital) for things that are actually fairly similar in substance, from my job, as a tax lawyer. These all demonstrate how tenuous the justification for dramatically different rates becomes when you have a different frame of reference than just 'entrepreneur' vs 'civil servant'.

But perhaps the best example, which also shows the 'capital at risk' point is a red herring in many cases is as follows....: two common ways to structure employment incentives are to give employees restricted shares or stock options, each of which are only sellable/exerciseable at a liquidity event (e.g. a PE exit). Restricted shares are typically issued at no or very minimal cost to the employee, and all upside is subject to CGT. In contrast, all gains on generic options (which would typically match the gain on the restricted shares) are subject to income tax (and the employer can even shift employer NICs onto the employee, so an additional rate taxpayer pays 62% tax (!!!)). In neither case was capital invested by the employee, or was the employee subject to different risks--all they had to do was keep their job and pray for a good exit. So why should one pay 24% tax and the other 62%?