MPs in IHT call

A group comprising some of the UK's leading academics and several Labour MP's has called for prime minister Gordon Brown to rethink inheritance taxation (IHT) policy.

They argue that an £80,000 taxation threshold could reduce the gap in social inequality, while perceptions of IHT as unfair are unsubstantiated as only 5.4 per cent of estates have been affected in the last few years.

In a letter to the Guardian the group stated: "Progressives must react to prevent any further inheritance tax reductions which again prioritise the richest over the poorest in our society."

Signatories of the letter include senior Labour figures such as chairman of the work and pensions select committee Terry Rooney and MP Clare Short.

IHT is a contentious issue following the Conservative party's pledge to raise the taxation level to £1 million, after which chancellor of the exchequer Alistair Darling doubled the current threshold to £600,000 in this year's Budget.

In his pre-Budget report, the chancellor further stipulated that spouses and civil partners may transfer unused Inheritance Tax nil rate bands for deaths occurring on or after October 9th 2007.