Make axing inheritance tax a manifesto pledge, say senior Tories

Commitment would be ‘sound politics’ in run-up to election

Rishi Sunak should make a manifesto pledge to abolish inheritance tax, senior Conservative MPs have said.
The Prime Minister is being urged to make the election commitment to put more “clear blue water” between him and Sir Keir Starmer, the Labour leader.
Cutting inheritance tax was considered ahead of last year’s Autumn Statement, but Mr Sunak and Jeremy Hunt, the Chancellor, instead opted for tax cuts more directly focused on boosting economic growth.
Inheritance tax thresholds have been frozen since 2010 and the levy is regarded by many as deeply unfair, because it penalises people who have saved money throughout their lives after paying tax on their income.
Nadhim Zahawi, a former chancellor who is standing down at next month’s election, said inheritance tax had “catastrophic results” for families as well as the wider economy.
“The campaign so far has seen the Conservatives put clear blue water between us and Labour, and has highlighted the total lack of ideas that Sir Keir has for Britain,” he said.
“There’s no better way to continue that fight than by pledging to abolish inheritance tax, the most unfair and hated tax in Britain. There are many economic reasons why it’s a terrible tax, but the main thing people should take from it is that it’s deeply un-human.
“There’s no more human desire than to leave the Earth knowing that you have passed something on to your children and grandchildren. The state gets in the way of this, with catastrophic results.”
The Telegraph has been campaigning for the abolition of inheritance tax for the past year. It is understood that Liz Truss, Mr Sunak’s predecessor, and Dame Priti Patel, a former home secretary, also want it to be scrapped.
The Conservative Growth Group, a caucus of around 50 backbench MPs led by Ranil Jayawardena, an ally of Ms Truss, is also supportive of the measure.
In her book Ten Years to Save the West, Ms Truss recalled that she and her chancellor, Kwasi Kwarteng, had planned to abolish inheritance tax in spring 2023, but were ousted by mutinous Tory MPs months before that year’s Budget.
David Jones, a former Brexit minister, said it was “a wicked tax, an unconservative tax and we should certainly abolish it”.
He added: “It’s a very fundamental thing for people to want to leave their assets to their children, or to whoever else they want to leave it, without the state interfering.
“The Government should certainly pledge to abolish it in the manifesto and, of course, Labour would never be able to follow it. It’s a hugely unpopular tax and a commitment to abolish it would be really sound politics.”
Sir Christopher Chope, who served as a minister under Margaret Thatcher, added: “Other countries have taken a similarly bold move. If we are having a radical election manifesto, why not include it in that?”
Senior Labour politicians have previously indicated they would oppose any cuts to inheritance tax, while tax advisers have said families are concerned that relief schemes could be tightened under a government led by Sir Keir.
Rachel Reeves, the shadow chancellor, said in 2021 she was prepared to examine “every single tax break” available if Labour came to power.
A poll carried out by YouGov in September found more than half of the country backs the abolition of inheritance tax, including 70 per cent of those who voted Conservative at the last general election in 2019.
Four per cent of estates currently pay inheritance tax but the Institute for Fiscal Studies think tank estimates that one in eight people will face a bill on their death or their partner’s death over the course of the next decade.
It comes as Britain’s overall tax burden is on course to continue rising to its highest level since the Second World War.
Earlier this year, The Telegraph revealed that thousands of grieving families had been hit with shock inheritance tax bills of up to £1.4 million because their relatives died within seven years of passing on gifts.