This figure is £83 million higher than the same period last year, continuing a two-decade trend of increasing receipts. The previous full tax year saw inheritance tax revenue total £7.499 billion.
Inheritance tax remains a contentious issue in political circles, especially given the Labour Party’s pledge not to increase major tax sources such as Income Tax, National Insurance, or VAT. However, a recent Wealth Club survey indicates that this stance may be unpopular, with 42% of respondents favouring cuts to inheritance tax over other taxes.
Nicholas Hyett, Investment Manager at Wealth Club, commented: “Inheritance tax remains a political hot potato. The new government has promised not to raise a whole host of taxes, but inevitably there are spending pledges that need to be met. That means those taxes that haven’t been officially ringfenced, including inheritance tax, are firmly in the spotlight.
Reforms to non-dom rules are one potential source of an inheritance tax windfall, but with an estimated £100 billion being passed on in inheritances and gifts in the UK each year, there’s probably more in play if the government is determined to raise extra cash.
That puts agricultural and business relief in the firing line. But, reforms need to be handled sensitively. Abolishing either completely would be devastating to family-owned businesses and farms across the country, while reliefs for the AIM market, Enterprise Investment Scheme, and Seed Enterprise Investment Scheme provide vital funding for Britain’s smaller companies. The optimum tax system should focus on the behaviours it encourages as well as the revenues it generates.”
