Overview
- The Institute of Economic Affairs argues the 40% levy above a £325,000 threshold — or £500,000 when a main residence goes to children — harms growth and pushes the UK out of step with peers.
- Nearly half of OECD members levy no tax on bequests to adult children, a comparison the report says makes Britain one of the tougher jurisdictions on family succession.
- The report labels the tax complex and costly, citing £66m in annual administration and a 1,000-page Tolley’s Handbook despite the levy raising far less than income tax.
- If abolition is rejected, proposed options include lifting the nil‑rate band toward about £2m, cutting the rate from 40% to 20%, and shortening the lifetime gift exemption period to as little as two years.
- A Treasury spokesman defends the current framework, noting most estates will not pay and pointing to recent changes such as raising farm relief to £2.5m after last year’s protests.