The beginning of the end for Inheritance Tax?
The Daily Telegraph, a prominent national newspaper, has recently launched a campaign urging the government to abolish inheritance tax (IHT). The publication highlights that over 50 Conservative MPs also support this call, considering the tax to be morally unjustifiable for individuals’ estates after their passing.
The newspaper’s front-page story emphasizes that the number of estates subject to IHT has significantly increased since the Conservatives came into power, despite previous promises to eliminate the tax for all but the wealthiest estates. This surge in affected estates is attributed to the continuous freezing of nil-rate bands.
The article argues that IHT is fundamentally unfair as it penalizes individuals who have diligently saved money throughout their lives, having already paid taxes on their income. It particularly impacts middle-class families seeking to assist their children or grandchildren in purchasing homes.
To address these concerns, The Telegraph is campaigning for the scrapping of inheritance tax, urging the Conservative party to prioritize this in their next election manifesto. The newspaper highlights growing apprehension that if the Labour party assumes power, savings and assets will be targeted to finance increased state spending.
The publication also notes an increase in letters from its readers, expressing their dissatisfaction with intrusive probate investigations into their estates.
Former Chancellor Nadhim Zahawi joins the criticism, asserting that inheritance tax is morally wrong, as it seizes assets upon a person’s death. Furthermore, it creates financial and economic distortions with far-reaching consequences.
Jacob Rees-Mogg, the former business secretary, echoes the sentiment, calling for the abolition of IHT and highlighting what he calls a relatively ‘modest’ contribution of £7.1 billion to the Treasury last year.
The Telegraph shares its analysis, revealing that the number of individuals paying IHT is projected to rise by 45% over the next decade, with the average bill surpassing £300,000.
In response to the campaign, a Treasury spokesperson emphasizes that over 93% of estates are expected to be exempt from IHT in the coming years. However, the tax continues to generate over £7 billion annually, supporting essential public services such as the NHS and schools.
To understand where you stand with inheritance tax and to explore strategies to mitigate its impact, speak with Ackary Benjamin, whose expert team can provide valuable insights to help you navigate the complexities of estate planning and taxation.