Rachel Reeves is set to spare second home owners from a capital gains tax raid in her first budget, according to reports.

Second homes will be left untouched because raising the levy on them could end up costing the Treasury money, The Times reported.

She is instead poised to raise the current 20 per cent rate levied on the sale of shares and could target other assets, while some reliefs in the current system are also expected to be axed.

The move is expected to raise an amount in the “low billions”, a government source told the newspaper.

When the last government cut the rate on second homes from 28 per cent to 24 per cent in its final budget, the Office for Budget Responsibility said that doing so would in fact raise almost £700 million because the number of property transactions would increase.

Revenues from capital gains tax can fluctuate widely because changes in the behaviour of a very small number of people can have a large impact.

Just 12,000 people pay two thirds of the £15 billion a year raised from capital gains tax.

HMRC has estimated that increasing capital gains tax by 10 points would reduce Treasury revenues.

“Very large tax rate rises can reduce exchequer yield due to taxpayer behavioural impacts,” it said.

The Institute for Fiscal Studies has said that any increases in capital gains tax should be accompanied by reforms to the system, such as by charging the levy on assets after people die.

Just 12,000 people pay two-thirds of the £15billion a year raised from capital gains tax.

More than half of all capital gains relates to the sale of shares, while just 12 per cent is from the sale of property.

Last month Lord Wolfson, the chief executive of Next, sold £29 million of his shares in the homewares giant, leading City analysts to speculate that the sell-offs were an attempt to sell them before any raid.

Sir Keir Starmer, the prime minister, has signalled that the government will increase capital gains tax but rejected reports it could rise to as much as 39 per cent.

He said that the suggestions of such a big rise were “wide of the mark”.

It comes as Ms Reeves prepares to launch the biggest Budget tax raid in history in her maiden Budget later this month.

It will involve as much as £35bn of tax rises – the most on record in cash terms – as she protects her commitment to ending “austerity” and attempts to ensure departments avoid real-terms cuts in spending.

There is also speculation that the budget will include the first increase in fuel duty for 13 years.

Ministers have also refused to rule out raising employers national insurance in a move that is set to raise significant sums.

Critics claim raising employer NICs would breach the spirit of Labour’s manifesto- which pledged not to raise income tax, national insurance or VAT.