Jeremy Hunt’s plans to cut inheritance tax in the Autumn Statement next week have been branded as ‘half-baked and half-hearted’ by the CEO of one of the world’s largest independent financial advisory, asset management and fintech organisations.
The damning indictment by Nigel Green of deVere Group comes as it is reported that the Chancellor will use the Autumn Statement to slash what is often described as the most hated of all taxes.
He is coming under increasing pressure from Conservative MPs to deliver some tax cuts for voters ahead of the general election and put some clear dividing lines between them and Labour.
The deVere CEO says: “Jeremy Hunt’s reported move to cut inheritance tax by 10 percentage points is a half-baked, half-hearted attempt to woo voters.
“What he should be doing is abolishing the most despised tax completely.”
IHT is often dubbed the most loathed of all taxation, as frozen tax thresholds and an incredibly high rate of 40% place more and more ordinary families at risk of being taxed.
The number of homes facing the IHT burden has more than doubled since 2010, despite it being designed as a tax for only the super wealthy, and around 40% of homes sold in England and Wales in 2022 were worth more than the basic allowance.
“IHT is clearly no longer limited to the ultra-wealthy, as initially intended. It is increasingly affecting middle-class families whose primary asset is their family home,” remarks Nigel Green.
“The desire to leave a legacy for loved ones is a deeply ingrained human instinct, and individuals find the IHT particularly objectionable as it essentially constitutes double taxation—taxation on assets that have already been paid for and taxed before.”
In a recent survey conducted by deVere Group in May, it was revealed that 72% of individuals aged 50 and above with taxable assets were unaware that the IHT threshold stood at £325,000.
“It’s disconcerting that those with assets susceptible to IHT lack understanding about the potential implications. This lack of awareness puts these individuals’ families at risk of facing an unexpected and potentially significant tax burden upon the death of a loved one.
“It is even more troubling given the strong sentiments people have against inheritance tax, detesting the notion of their already taxed money being subjected to further taxation.”
Of the recent reports of a reduction in inheritance tax, the deVere CEO concludes: “This is a weak plan. Scrapping inheritance tax once and for all would not only be the right thing to do, but also an historic, popular vote-winning strategy.”
