Monday, August 21, 2006

Stephen Byers has a point

I never thought I'd agree with Stephen Liars but he's absolutely right about inheritance tax. However, the question for me is does he really believe the tax should be scrapped or is he just firing the starting gun in the Blair/Brown conference battle that is looming?

I prefer the latter to the former as explanation for his motives. However, I do hope the former becomes a central plank of any future Tory manifesto (at least in some way). I realise that we're being very careful right now not to mention specific tax cuts, but scrapping, or significantly raising the inheritance tax threshold would be a sensible move.

Inheritance Tax thresholds are the most blatent example of fiscal drag on the part of the Chancellor. They're a very clear indicator of how he has slowly increased his take of individual's wealth by stealth. There probably is an argument for inheritance tax on the "mega-rich", but many today get stung simply because the housing market has risen so much. Having a highly valued proeprty is no longer a genuine indicator of wealth.


Tapestry said...

Look what happens to Communists when they get rich!!

Jonathan Sheppard said...

Dizzy - spot on. What is the threshold? £250k? Im sure that doesn't buy you much these days, so having an "estate" valued in this region really doesn't make you one of the nation's more wealthy individuals/families.

dizzy said...

I beleive the current threshold is maybe £285K, which sounds a lot but is basically a 3/4 bedroom semi in London and the South East.

The biggest problem is pensioners I think. Many of them bought their properties and got into the equivalent of massive hock in their day, worked hard and are now considered rich because of it. In some respect the Council tax penalises them as well as it assumes that big house = big income.

Anonymous said...

Unfortunately "Dave" and his cohorts won't abolish inheritance tax; they are too busy positioning themselves to win the "middle ground" by committing themselves to carrying on the current administration's discredited corporatist policies of high government spending.

However, times have moved on and the taxpayer is becoming increasingly uneasy about the vast amounts squandered on public services without a corresponding improvement in performance. No major political party appears to be prepared to articulate these fears which is why there will be an even lower turnout at the next General Election - and the Tories will lose again.

Unknown said...

This is now very much a "middle ground" issue. I had someone bring it up on an ex-council doorsep in Lewisham this spring.

This will increasingly hit the strivers and as the baby boom, home owning generation start to die off thirty and fourty somethings will start to feel the pinch.

Some party will push this through and it might as well be us.

Croydonian said...

My least favourite tax by far, and I'm not especially keen on any of them. Bit of a shocker hearing it from Byers though.

Anonymous said...

Croydonian, you could not have put that better - my thoughts exactly.