Proposed death tax is no way to pay for social care
THERE is something about governments helping themselves to our hard-earned money after a lifetime of saving that does not sit well with the British character. Most of us are willing to forgo luxuries so long as we can pass something on to our children. What we do not approve of is when that already taxed money is then “double-dipped” by government whether in inheritance tax or the proposed “death tax” to pay for social care. It can arouse the sort of anger that fuelled Brexit.
As the Government ponders whether it is a good idea to take a compulsory levy from our estates when we die I must offer them a warning from recent history.
The Conservatives might be riding high in the polls today but let us remind them of the dark days 10 years ago when the Tories had been out of power for a decade during the Tony Blair years. It looked as though they might never get back into government but then George Osborne stood up at his party conference in 2007 and pledged to cut inheritance tax – partly as a result of the Daily Express’s crusade. Almost at a stroke the Tory Party began to rise in the polls and were on the path to power.
WHY did this speech matter? Because Osborne showed he understood what matters most to the ordinary voter. He said that the property death tax punished people who had been doing the right thing all their lives.
“People whose only crime in the eyes of the taxman,” he said, “is that instead of spending money on themselves, they want to pass something on to their families.” It is the most basic human instinct of all, he proclaimed.
Shockingly, once this pledge had helped to make them electable again, Osborne ditched his flagship policy two years later and David Cameron only just scraped into coalition.
The U-turn left a nasty taste in the mouth of many Tory voters that no doubt helped them jump ship to Ukip. I don’t think either Theresa May or Philip Hammond would like to unleash that process again by introducing a “death tax” on hard-earned savings. Something they should think hard