Before the upcoming general election, Prime Minister Rishi Sunak is considering lowering the country’s inheritance tax, citing people familiar with the situation. Sunak was enthusiastic about the notion whilst he was the Chancellor of the Exchequer under Boris Johnson. However, legislative recommendations have yet to be made public.
The rising tax burden right at postwar has the Conservatives worried about a backlash from voters. Sunak has referred to himself as a “low-tax Conservative” numerous times. According to polling, a reduction in inheritance tax would be widely supported. A YouGov poll conducted in October on behalf of Kingsley Napley found that 63% of respondents favour raising the £325,000 threshold at which the tax is first due.
The government still needs to offer a statement on the subject. Sunak’s objective, according to Bloomberg, is to reduce inflation. Another official stated that it was too early to declare because the financial statement from Chancellor of the Exchequer Jeremy Hunt, due in the fall, has yet to be started.
In southern England, a bastion for the Conservatives, inheritance tax receipts is skewed towards wealthier households. Therefore, decreasing what some call a death duty might strengthen the base.
The opposition Labour Party is unlikely to match a tax cut that some of its supporters would view as regressive and favouring better-off Britons. Reducing the tax could potentially cause a wedge in the middle of the Conservatives and the opposition Labour Party.
On the subject of when Sunak will announce an election, there is a rumour. During an interview with Bloomberg TV this week, Hunt made the speculative suggestion that favourable economic data might eventually result in an election in the spring of 2024. The Times stated that Sunak is considering holding a poll in the fall of 2023.
References
Wickham, A. (2023, April 14). Sunak Eyes Inheritance Tax Cut as Tories Gear Up for UK Election. Bloomberg.com; Bloomberg. https://www.bloomberg.com/news/articles/2023-04-14/sunak-eyes-inheritance-tax-cut-as-tories-gear-up-for-uk-election#xj4y7vzkg
Rishi Sunak “considers inheritance tax cut” ahead of general election. (2023, April 16). The Independent. https://www.independent.co.uk/news/uk/politics/inheritance-tax-tories-sunak-election-b2320620.html
Jump. (2023). mint. Mint. https://www.livemint.com/
