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Labour Minister Opens Door to Inheritance Tax Raid as Chancellor Seeks to Plug £50bn Spending Hole
In a shocking move, Labour minister Dame Diana Johnson has hinted that the party may be considering an inheritance tax raid to address the UK’s growing fiscal crisis. This comes as Chancellor Rachel Reeves faces mounting pressure to balance the books by the end of the decade.
According to sources close to the Treasury, officials are examining ways to tighten rules around the gifting of assets and money to help fill a £50bn spending hole. The proposed changes could include introducing a lifetime cap on gifts, which would limit the amount an individual can gift before their death.
The Tories have warned that such a move would be a “punishment” for people who have worked hard and saved responsibly, allowing them to leave something behind for their loved ones. They argue that Labour’s approach is rooted in politics of envy, aiming to target those who have benefited from rising property prices and gold-plated pensions.
Meanwhile, Chancellor Reeves has been under pressure to raise revenue without impacting the working class. As a result, the Treasury is said to be considering a mix of “sin” taxes and duty hikes. This could include increasing duties on goods such as tobacco, alcohol, and gambling. Additionally, there may be a freeze on income tax thresholds, which would lead to more individuals being pulled into paying higher rates of tax.
The move follows an analysis by Pantheon Macroeconomics predicting that the Chancellor will need to implement “sin” taxes and duty hikes in order to balance the books. The think tank also suggested that pension-tax or unspecified spending restrictions could be used to address the fiscal hole.
It appears that Labour officials are concerned about the amount of wealth being extracted from pension pots and gifted to relatives. They seek a solution to ensure fairness in any approach.
The Government has reaffirmed its commitment to keeping taxes for working people as low as possible, having protected their payslips at last autumn’s budget.
Source: www.dailymail.co.uk
