UK ministers should look at imposing a wealth tax on the rich to aid the recovery from the coronavirus pandemic, the shadow chancellor has urged. Anneliese Dodds, in her first major speech in the role, told the government on Friday “to not increase taxes or cut support for low and middle-income people” during the crisis. She said a “new settlement” was needed to address the injustice of the worst-off paying more tax proportionally than high earners, while the richest derive a significant part of their income from wealth. Dodds criticised the prime minister’s “muddled, confusing” and “much too slow” response to protecting the nation’s health during the Covid-19 outbreak. She called on the government to adopt a “targeted strategy” in extending the furlough scheme to avoid a “flood of redundancy notices”, particularly for areas forced into local lockdowns such as Leicester. But she said Labour would not back extending the job-retention scheme – in which the government has been meeting up to 80% of workers’ wages – indefinitely, insisting it should be used to shore up specific sectors. “These support schemes should serve as economic sandbags, ensuring localised second waves of Covid-19 don’t wash away businesses and jobs in their wake,” she said. “The reward for months of sacrifice cannot be a redundancy notice.” Her intervention came after Boris Johnson said it would not be “healthy” for the economy or workers for the furlough scheme to continue beyond its scheduled end date in October. With Rishi Sunak due to set out his latest update on the economy next week, Dodds called on the chancellor to deliver a “back-to-work budget”. Dodds also said the government should consider imposing a wealth tax, which would target assets rather than income. “I think the government does need to look at this area, I don’t think we’re in a fair situation,” she said, arguing that the tax paid by the rich was a smaller part of their income proportionally than the poor. And of course for the very, very best-off people quite a bit of their money coming in is derived from wealth. “I think we do need to have that new settlement and actually much of the opinion data has indicated that has a lot of support among the UK population as well.” Labour under Keir Starmer has aimed to take a “constructive” approach to opposition, backing measures the party believes to be valid while critiquing areas in which the Conservatives are failing. Dodds was clear that she believes the government dithered over the lockdown, increasing testing and getting protective equipment to frontline workers as the death toll soared. Along with accusing ministers of being “completely divorced” from the scale of the looming unemployment crisis, she said “we still do not have a functioning” test and trace system to prevent a second wave of infections.