Over half of people surveyed about inheritance tax (IHT) were in favour of abolishing the levy according to a YouGov poll commissioned by law firm Kingsley Napley.
The poll revealed 56% of people now want a complete abolition of inheritance tax (IHT), compared to 54% in last year’s poll and 49% 2 years ago.
The poll also revealed a softening of opposition to an increase in the current 40% levy, from 76% last year, to 71% this year; meanwhile two thirds of respondents supported raising the current £325,000 threshold.
Despite the continued spectre of estate being affected by IHT, there is little change to appetite for professional advice suggested the poll. 78% of respondents said they have either not considered (73%) or decided against (5%) doing so and only 15% of those polled had either done so (5%) or intended (10%) to do so. The same question 12 months ago revealed 76% and 16% respectively.
James Ward, Partner and Head of Private Client at Kingsley Napley, says: “There has been some political posturing on IHT in recent weeks given the unpopularity of this tax. Let’s see what the Conservatives say at Conference. However, personally I doubt Healey will go there on full abolition. He may introduce a few tweaks but I’m not convinced this Government is yet ready on replacement ideas for this tax. Most likely his focus will be in other areas.”
“Whilst a majority want to scrap this tax, I always say be careful what you wish for,“ continued Ward. “Inheritance tax is effectively this country’s wealth tax. Currently only 1 in 20 estates pay it and yes, it is viewed by many as a double tax on death after already paying dues in life. But given the pressure on state finances, the revenues would need to be found elsewhere and any alternative measures could be far more onerous, such as a yearly wealth tax. The other thing about the ‘devil-you-know’ is that it is possible to plan around the tax and reduce the effective rate of tax on your estate over time. Burnham’s ascension to PM this summer has caused many to revisit their estate planning and seize opportunities to gift out of excess income, set-up trusts or seek to benefit from potentially except transfers whilst there is still a window to do so.”
