The Conservative Party has said that it will exempt all properties worth less than £1 million from inheritance tax, should it win the next election.
Chancellor George Osborne said that the move will support our basic human need to provide for our children. It will mean that more homeowners are able to pass their homes on to their children without paying tax.
The Labour party said that the Conservatives have made similar promises before and failed to deliver. Deputy leader, Harriet Harman, said that as the election approaches, it was becoming clearer that the Conservatives stood to benefit the well off, whereas Labour wanted everyone to be better off.
Independent economists said that raising the level at which properties qualify for inheritance tax in this way will disproportionately benefit the wealthy and push up property prices still further.
The Labour Party has said that it will raise £7.5 billion by fining tax avoiders and closing tax loopholes should it win the coming general election. Shadow Chancellor, Ed Balls, said that his party will carry out an immediate review of tax collection in order to close all existing loopholes, if Labour wins the election in May. They promised to increase and strengthen HM Revenue and Customs’ powers to collect taxes. They will also change rules that enable private equity managers to avoid income tax and hedge funds to sidestep stamp duty.
The Conservatives have said that they will raise £5 billion from tax avoiders but have not yet said how this will be done.
Director of Institute for Fiscal Studies, Paul Johnson, said that both parties are guilty of making up numbers. Neither party can actually know how much money can be raised by cracking down on tax evasion, he added.
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