The Institute for Public Policy Research has released their suggestions for a re-vamp of the Inheritance Tax legislation in the UK. They believe that the current rate of 40% tax should be cut for middle-class families and the very wealthy to pay more. The suggestion is that people with estates valued between £263,000 and £288,000 should pay 22% tax, those between £288,000 and £763,000 should pay 40% and those with estates valued over £763,000 should pay at 50%.
Our View
There are many things that need sorting out in the UK in terms of how it is run and increasing taxes through Inheritance Tax is not one of them. Perhaps if the Government sorted out the Social Security system in terms of proper qualification and payouts, additional tax would not need to be raised.
The level of Inheritance Tax is no longer realistic and this is why people are paying more tax. Estates have risen in value and, unless we are very much mistaken, we believe people would rather have more valuable estates to be able to pass on. If people want to avoid Inheritance Tax, they should do something about it.
As we have always said, Inheritance Tax is a voluntary tax and no one need pay it.