Debate over the future of Inheritance Tax (IHT) shows no sign of dying down, Carter Lemon Camerons’ private client partner Ian West has said.
It is only a few months since George Osborne used his Summer Budget to confirm that long-awaited changes to the nil-rate-band would finally be introduced.
But the announcement seems to have only fuelled the debate about whether more radical changes should be implemented or indeed if the tax should be abolished altogether.
In a newspaper column this month, the director-general of the Institute of Directors, Simon Walker, came out in favour of doing just that.
“The list of charges against Inheritance Tax is so long that it makes the levy’s longevity completely inexplicable,” he told the Daily Telegraph. “It is rightly seen by the public as the most unfair of all taxes.
“The Government would argue that they have softened the blow by introducing at July’s Budget an additional primary residence exemption, so that a person could in theory pass on a house worth up to £500,000, or £1 million for a couple. But rather than removing the deleterious effect, it just exposes the tortuous and wicked complexity of this tax.”
Meanwhile, Labour’s new leader Jeremy Corbyn has indicated that he would want to change the way the levy worked if his party wins back power in 2020.
When asked for his views on IHT, Mr Corbyn said that he thought the tax should be “graded” rather than applied at a flat rate.
Labour will consider whether it should formally change its policy about the way the tax is raised as part of a wider review of personal taxation.
If you require advice on Inheritance Tax (IHT) planning, please contact Ian West, Michael Woodward or Katie Ward.
