Published On: Mon, Aug 19th, 2019

Inheritance tax fury: How PM Corbyn plans to ‘steal’ YOUR money ‘before you’ve even died’ | Politics | News

Jeremy Corbyn is stepping up pressure on Boris Johnson in a desperate attempt to oust Boris Johnson and finally wrestle control of 10 Downing Street. He plans to table a motion of no confidence in the Government at the “earliest opportunity when we can be confident of success” – this could even be as soon as Parliament returns from summer recess on September 3. With the prospect of a general election just weeks away, Mr Corbyn’s plans for office are in the spotlight, with experts lashing out at the Labour Party‘s inheritance tax reforms which will “steal” Britons’ cash before they are even dead.

In June, Labour unveiled proposals to reform inheritance tax, which would be replaced by something described as a “lifetime gifts tax”.

The current scheme allows up to £475,000, or £950,000 for couples, to be passed on without tax.

But under Labour’s new proposals, everything a child receives from their parents above the value of £125,000 during throughout their lives, as well as after their death, would be taxed.

The threshold would be set for each child, so two children could inherit an estate worth £250,000 tax-free. Anything above the threshold would be taxed annually at income tax rates.

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Jeremy Corbyn’s plans to overhaul inheritance tax have sparked furious reaction (Image: GETTY)

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Jeremy Corbyn’s tax plans have been heavily criticised (Image: PA)

These people want to steal our hard-earned money before we’ve even gotten to the morgue

Matthew Lesh

It means parents giving their homes or hard-earned savings to their children while still alive would be taxed.

Matthew Lesh, Head of Research at the Adam Smith Institute think tank, told “These people want to steal our hard-earned money before we’ve even gotten to the morgue.

“Labour’s updated death tax proposals are insulting to those who spent their lives working hard and want to pass along some of their success to their children.

“It is often forgotten that this income would already have been taxed once when it was earned. It is nonsensical to tax it another time before it is spent. This will just discourage people from working hard, founding businesses, creating jobs and providing value to society.

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“It will also just lead people to play games and hire accountants to hide their income from the system, an inefficient use of resources.

“We should be trying to entice entrepreneurs to come to the UK post-Brexit, not introducing new taxes that encourage those already here to shut up shop and leave.”

Ben Harris-Quinney, Chairman of The Bow Group think tank, warned the proposals could make Britons among the most taxed in the world.

He told “Coybyn’s proposals to radically reduce the inheritance tax bracket would ensure the Government would eventually end up taking almost all of a citizen’s income over a lifetime.

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john mcdonnell

John McDonnell said Britain needs a ‘fairer system of how we can ensure that wealth is more fairly distributed’ (Image: PA)

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Labour said ‘Britain is a deeply unequal country and we need to start talking about that’ (Image: AFP / GETTY)

“This would make British citizens among the most taxed in the world and reducing the incentive to work hard.”

James Heywood, Senior Researcher at the Centre for Policy Studies, warned of the possible overhaul: “This would be an administrative nightmare.

“Any large transfers between family members would need to be reported to HMRC, and presumably this would include non-cash gifts such as cars and other assets too.

“To take the principle of such a tax to its logical conclusion, would parents be taxed for letting their children live in the family home rent-free, based on the large savings in housing costs they are providing?

“We should also be careful about taxing things more than once – we should remember that the person making the gift will likely already have paid income tax and possibly other taxes.”

prime ministers

Jeremy corbyn is bidding to become the UK’s next Prime Minister (Image: EXPRESS)

Leading tax barrister Patrick Cannon argued Mr Corbyn’s “tax raising measure” would hit those hardest in the middle class as the rich would have found ways to swerve it.

He told “This is not an expenditure promise but a tax raising measure. The middle class would be hardest hit. The rich would finally decide to depart these shores before the tax came in.

“A Corbyn Government may well try this but it is likely that they would fail as did the Labour Government in the dark days of 1974.”

When Labour announced their inheritance tax proposals in June, Shadow Chancellor John McDonnell told Sky News: “We are looking at it and it might be one of those ideas, and we’re consulting on it at the moment.

“We need to have a fairer system of how we can ensure that wealth is more fairly distributed, that’s one idea and we are listening to a whole range of ideas.”

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Brandon Lewis lashed out at Labour’s tax proposals (Image: GETTY)

But the Tories claimed it could impact 10 million households according to Land Registry Data, but Labour insisted the proposed policy is not yet part of its plan should the form a Government, but was under consideration.

Party Chairman Brandon Lewis said: “This shows the truly shocking extent of Corbyn’s tax raid on homes. Over 10 million would be caught by Labour’s new tax grab, hammering families across the country.”

A Labour spokesman at the time reiterated the proposal was not yet formal policy, adding only 63 percent of homes in Britain are owner-occupied, thus the suggestion 10 million homes would be impacted was too high.

They added: “As the report makes clear, Britain is a deeply unequal country and we need to start talking about that.”

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