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Inheritance tax.


Jeremy Hunt is planning a stealth raid on inheritance tax in the Autumn Statement as part of the chancellor’s attempt to raise about £54bn through tax rises and spending cuts to fill the hole in the public finances.

With inflation high, Hunt plans to keep tax-free thresholds at the same level for various levies, including those on income, pensions and capital gains, to expand the state’s tax haul by billions of pounds via the back door. The move will hit traditional Tory voters, but Hunt and prime minister Rishi Sunak insist that those with «the broadest shoulders» must pay more. Hunt has already reinstated Sunak’s plan to increase corporation tax rates to 25 per cent next April. Liz Truss’s administration had proposed to stick with the current rate of 19 per cent.

Before Sunak became prime minister, Hunt had kept the current 8 per cent «bank surcharge» on the table, which could have seen the effective tax rate for banks rise from 27 to 33 per cent from next April. But Sunak has insisted on sticking to the 25 per cent corporation tax rate from next April. So he will cut the bank surcharge from 8 per cent to 3 per cent, meaning banks will pay a higher effective rate of 28 per cent. According to Adam, extending the threshold freeze for another two years beyond 2025-26 would raise £400mn-£500mn if inflation returns to its target level of 2 per cent.

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  1. Sam9 November 2022 at 11:23

    Don't see inflation returning to 2% any time soon. It might take 3 or more years for this to happen. This is just wishful thinking if you ask me.

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