Banks' rescue package to spur IHT

Date: 15th October 2008

Inheritance taxation (IHT) will soar due to the latest financial sector rescue package, according to one specialist.

The Treasury's £37 billion pay-out to three major high street lenders this week was the first step in a wider £500 billion project, which has already led to concerns that taxes could soon be set to rise.

Now, one expert believes that IHT could become a major source of government funding, irrespective of which party is in power.

Chairman of Way Fund Managers, Paul Wilcox, told QCK: "We are now convinced that irrespective of which party comes to power at the next general election, inheritance tax … will continue to be seen as a golden goose."

Shadow chancellor George Osborne stated earlier this month that the IHT threshold would rise to £1 million if the party were to gain a majority in the Commons.

A senior official with Capital Economics stated this week that either taxation would have to rise or public spending would have to be cut in order to fund the banking bail-out.