Corbyn inheritance tax hike would leave thousands worse off

HUNDREDS of thousands of families who want to leave their homes to their children will face huge inheritance tax bills under Jeremy Corbyn, it emerged yesterday.

Labour plans to halve the amount married couples can pass on without facing death duty of 40 per cent from £850,000 to £425,000 – or possibly lower.

It means many thousands of households will be dragged into paying inheritance tax, reversing Tory plans to raise the allowance.

Reforms that came into effect last month brought the threshold for a couple to leave their family home to their children tax-free to £850,000, with further increases due to take the figure up to £1million by 2020.

The tax is levied at 40 per cent of the amount above the allowance, so cutting the threshold to £425,000 would mean properties worth £525,000 would attract inheritance tax of £40,000.

More than half of London’s 3.5million homes are worth in excess of £425,000. The average price is also higher for a semi-detached house in Oxford, Cambridge and Hertfordshire, as it is for detached ones in Buckinghamshire, Sevenoaks, Winchester, Chichester, Chelmsford, Poole, Maidstone, Cheltenham, Warwick and Bristol.

Shadow chancellor John McDonnell yesterday pledged to end ‘ tax giveaways’ introduced by the Tories.

He told the BBC: ‘When we publish our manifesto we will make sure it is a fair tax system. What does that mean? First of all, making sure we tackle tax evasion and tax avoidance, because this Government has neglected that.

‘Secondly, fair taxation will be about ending the tax giveaways to corporations and the very rich. Where I identify the need for tax increases, I give this assurance, middle and low earners will be protected.’

Mr McDonnell named inheritance tax alongside corpora- tion tax, capital gains tax and the bankers’ levy as areas where Labour believes the Government has provided ‘giveaways’ to the rich.’

He added: ‘We will be reversing these tax giveaways and when we come forward with our manifesto there will be a detailed costing of each proposal,‘ he said.

A Labour spokesman added: ‘Labour do not support the inheritance tax giveaways announced by the Tories.

‘We will set out in detail our priorities on taxation in the coming weeks when we announce our manifesto, but we believe in a fair tax system that stands up for the many, not the few.’ However, the Conservatives dismissed the inheritance tax plan as ‘nonsensical’ yesterday.

Housing Minister Gavin Barwell said: ‘Not content with hiking taxes on the living, now Jeremy Corbyn wants to hit you harder when you die. This nonsensical and unfair idea would punish people who have worked hard, saved all their lives and want to pass on the family home to their children.

‘It is more proof of the huge new tax and debt bombshell Jeremy Corbyn will drop on families to pay for his reckless spending promises if he makes it to Downing Street, propped up in a coalition of chaos by the Lib Dems and the SNP.’

Boris Johnson, the Foreign Secretary, tweeted: ‘Corbyn wants inheritance tax raid on HALF of London! Don’t risk Labour coalition of chaos.’ Mr McDonnell revealed his plans to raise inheritance tax as the Tories yesterday warned Mr Corbyn would unleash ‘economic chaos’ on the country.

Chancellor Philip Hammond said voting Labour was a ‘high-risk gamble’.

Labour said yesterday it would halt planned hospital unit closures if it wins the election – even though it had previously agreed to them.

Health spokesman Jonathan Ashworth vowed to stop the NHS sustainability and transformation plan (STP) outlining the cuts.

But Health Secretary Jeremy Hunt said Labour had backed the pledges, including in its 2015 manifesto.

The British Medical Association says 44 local STPs will make cuts of £22billion by 2021. Labour would not give plans to meet the shortfall.

‘Hit you when you die’