Non spiky Politics 2

I don't think it's the politics of envy to point out the ramifications that a policy might have on different groups of people. I think politicians are doing that all the time ie How will this affect our core voters? Who will this policy potentially alienate? Will this policy policy appeal to voters who might not like our other policies? etc etc. Political parties spend a lot of time and money on focus groups. Why? Because they want to know how different groups, ages etc will respond to their policies and how, potentially, that might affect who votes for them.

The politics of envy.

foxie. I do think it would discourage people who might otherwise downsize. Neidle estimates the raw number would be comparstively small but it would happen disproportionally nationally adding to the shortage of family-sized homes in London and the South East.

I don’t think a great deal of thought has gone into this promise other than a vain hope it will appeal to what’s left of the dwindling Tory voter base and maybe encourage some who have defected to Reform to come back.

No doubt an idea from Andrew Griffith, the man who was junior Treasury minister under Liz Truss who admitted that its "fatal mistake" then was failing to clearly set out how tax cuts would be paid for. A sense of déjà vu?

Although we can guess how Tories would pay for this little sweetener of giving a tax cut where 90% of it would go to the wealthiest fifth of pensioner households. The poor would pay for it with more austerity.

Neidle sums it up: The Conservatives’ press release says inheritance tax is “bad for growth”. The evidence doesn’t support that.

If gifted a whole load of money then Inheritance Tax would have been paid on it.
Moneys earned by the generous benefactor would also have been taxed.

can anyone give me a rational explanation as to why someone working and earning pays tax, but someone gifted a whole load of money having not got out of bed for it, doesn’t pay a brass farthing?

Could it be that it’s because those savings etc had/have already paid tax on them when originally earned? Yes I get your point that any inherited money (I’ve never had any so just an observation here) just drops into the laps of some lucky people but I dare say back in the day when it belonged to the person who earned it, all relevant deductions were made at that time?

That's interesting, Graphite I think it would also increase house prices for those lower down the housing chain, not helpful to younger people wanting to buy their first home even with the help of the "bank of mum and dad".

The Conservatives propose exempting family homes from inheritance tax and increasing the tax-free allowance to £500,000 per person. They say this would cost £6bn a year. Our analysis suggests £7.7bn–£10.9bn, once we account for the incentive to hold on to homes and move other wealth into housing.

The problem is that the proposal gives wealthy pensioners a powerful reason to buy bigger houses. If you sell investments, and put the money into your home, then your children could save 40p in tax for every £1 you spend. If you downsize, on the other hand, every £1 of house value you sell could increase IHT by 40p.

(Source Dan Neidle Tax Policy Associates)

More here about why this is wrong and unfair.

taxpolicy.org.uk/2026/10/08/conservatives-inheritance-tax-family-home-cost/

The problem that I have with increasing the IHT threshold is that further creates an imbalance between those who come from home owning families and those who come from families that haven't been able to get on the housing ladder

Looking at it from another angle, it could help some younger people who have been unable to purchase a home of their own, as they could inherit enough for a good deposit.

foxie48

"In the 2023 to 2024 tax year, 30,400 estates paid Inheritance Tax (IHT) in the UK, which accounts for 4.72% of all UK deaths." AI generated

The problem that I have with increasing the IHT threshold is that further creates an imbalance between those who come from home owning families and those who come from families that haven't been able to get on the housing ladder, it also helps to fuel the housing market whilst effectively reducing the amount of money that people have to spend on things that would further boost the economy. I can see that people want to pass on their wealth to their children but I can also see how damaging that potentially is in creating a divisive society. It's difficult, if not impossible to create a fairer society that pleases everyone.

Your last sentence is so true, it is literally impossible.

History shows that it has been tried.

"In the 2023 to 2024 tax year, 30,400 estates paid Inheritance Tax (IHT) in the UK, which accounts for 4.72% of all UK deaths." AI generated

The problem that I have with increasing the IHT threshold is that further creates an imbalance between those who come from home owning families and those who come from families that haven't been able to get on the housing ladder, it also helps to fuel the housing market whilst effectively reducing the amount of money that people have to spend on things that would further boost the economy. I can see that people want to pass on their wealth to their children but I can also see how damaging that potentially is in creating a divisive society. It's difficult, if not impossible to create a fairer society that pleases everyone.

Who gives away a billion?
Any monies gifted to family over a fairly low amount will be taxed, so that brings in money.
There are few mega rich people in the UK in comparison to the well off as GrannyGravy says.And they all pay tax and they all buy goods and services and are usually employers.

The effect on the economy is fairly small however, and it will not make up the shortfall that cutting welfare will have on growth.

So how is it fair to give say a billion to those who are already relatively wealthy as against retaining that billion to support say health, education, benefits etc.

In my view it is not an economic growth strategy, but a redistribution of wealth from the poor to the rich.

Whitewavemark2

Two things - can anyone give me a rational explanation as to why someone working and earning pays tax, but someone gifted a whole load of money having not got out of bed for it, doesn’t pay a brass farthing?

Also I don’t understand the rationale, that, given the premise that growth is badly needed and knowing that those with wealth do not spend, but squirrel it away. And yet to pay for the tax cut, the Tories propose to cut welfare - people who do spend any extra income on life’s necessities, like fuel, food, children’s clothing etc thus helping to grow the economy?

There is a need to distinguish between the so called mega rich and the moderately wealthy.

Which is why I advocate for an increase of the IHT threshold and the rate to be in stages not an immediate 40%.

The moderately wealthy (you could call them middle class) do spend their money, often locally, they employ gardeners, cleaners, go out to eat, theatre etc.

Whitewavemark2

Two things - can anyone give me a rational explanation as to why someone working and earning pays tax, but someone gifted a whole load of money having not got out of bed for it, doesn’t pay a brass farthing?

Also I don’t understand the rationale, that, given the premise that growth is badly needed and knowing that those with wealth do not spend, but squirrel it away. And yet to pay for the tax cut, the Tories propose to cut welfare - people who do spend any extra income on life’s necessities, like fuel, food, children’s clothing etc thus helping to grow the economy?

The gifted money will have already been taxed so is in effect being taxed twice. Also we all want to be able to give our heirs, in most cases our children, their inheritance. This is a basic human desire.

The wealthy also have to pay for life’s necessities. They also need to pay for the items you have listed. They also pay a lot of taxes. kemi’s idea for welfare to be paid by card to be spent on food and utilities, is a really good idea. After all it is taxpayer’s money.

Can I just give a gentle reminder to you that this is a gentle thread.

Two things - can anyone give me a rational explanation as to why someone working and earning pays tax, but someone gifted a whole load of money having not got out of bed for it, doesn’t pay a brass farthing?

Also I don’t understand the rationale, that, given the premise that growth is badly needed and knowing that those with wealth do not spend, but squirrel it away. And yet to pay for the tax cut, the Tories propose to cut welfare - people who do spend any extra income on life’s necessities, like fuel, food, children’s clothing etc thus helping to grow the economy?

Oreo

Meandrogrog

David49

In a non spiky way you can't improve care services without increasing taxes someone has to pay, increasing IHT is one way.
It doesn't affect you directly, it means your family would inherit less say £450k instead of £500k. £50k care levy out of all estates would make a big difference.

0nly 4% of estates pay IHT so abolishing it costs little Badenoch knows that but it's a good vote catcher

David49 are you sure it is just 4%?

I only ask as we live in the south east and we would be caught in the inheritance tax net. I would not put us in the 4% .

It is house prices in so-called affluent areas that push estates into paying this tax.

The 4% is what’s being quoted but it is surprising isn’t it?
£500,000 is a modest 3 bed house in the South East.

Yes indeed. That is why I think Kemi’s plan is sensible 😊

Inheritance Tax was meant to stop the very wealthy from passing on too much to their heirs.

Meandrogrog

David49

In a non spiky way you can't improve care services without increasing taxes someone has to pay, increasing IHT is one way.
It doesn't affect you directly, it means your family would inherit less say £450k instead of £500k. £50k care levy out of all estates would make a big difference.

0nly 4% of estates pay IHT so abolishing it costs little Badenoch knows that but it's a good vote catcher

David49 are you sure it is just 4%?

I only ask as we live in the south east and we would be caught in the inheritance tax net. I would not put us in the 4% .

It is house prices in so-called affluent areas that push estates into paying this tax.

The 4% is what’s being quoted but it is surprising isn’t it?
£500,000 is a modest 3 bed house in the South East.

But there’s no reason why it can’t be either.
I hope Andy Burnham gets to grips with the river pollution scene, at one time it was going well but now is just terrible, why anyone would go wild swimming in them is beyond me.

Wyllow3

I dint think the brief for this forum is laid out for politics at all!

Just read its description.

That’s what some of us are saying.
The OP tells us to read the guidelines for using the cafe.
Nowhere in the guild lines does it say it’s for light weight politics.

David49

In a non spiky way you can't improve care services without increasing taxes someone has to pay, increasing IHT is one way.
It doesn't affect you directly, it means your family would inherit less say £450k instead of £500k. £50k care levy out of all estates would make a big difference.

0nly 4% of estates pay IHT so abolishing it costs little Badenoch knows that but it's a good vote catcher

David49 are you sure it is just 4%?

I only ask as we live in the south east and we would be caught in the inheritance tax net. I would not put us in the 4% .

It is house prices in so-called affluent areas that push estates into paying this tax.

^Is IHT a good vote catcher?
Not so sure^

Think I need to qualify that.
Not a good vote catcher amongst Tory voters. Maybe overall?

No arguments or judgements on this thread.
Write what you like, within those GN rules.

Personally, I dont feel I belong as such to any Party.
Though will vote for one of them, most likely, when the time comes.

Is IHT a good vote catcher?
Not so sure.

I dont tend to read polls. They always seem so biased towards a certain group or another.

I think posters will get used to non spiky politics.

In a non spiky way you can't improve care services without increasing taxes someone has to pay, increasing IHT is one way.
It doesn't affect you directly, it means your family would inherit less say £450k instead of £500k. £50k care levy out of all estates would make a big difference.

0nly 4% of estates pay IHT so abolishing it costs little Badenoch knows that but it's a good vote catcher

Please,please don’t let this be spiky. If you feel angry about this thread, go to the politics thread and leave this one alone. Noone forces participation.