High net worth individuals consider inheritance tax to be unreasonably high, the Saltus Wealth Index Report has revealed.
According to Saltus’ data, 25% of HNWIs describe IHT as the most unreasonably high tax, with 88% believing the threshold should be increased, while 25% believe it should be abolished altogether.
The discontent follows Labour’s decision to extend the freeze on IHT thresholds until 2030, meaning more families will be caught in the net. In response, a third (33%) of HNWIs say they are accelerating wealth transfers to their children during their lifetime, while a similar number have sought financial planning advice on managing their exposure to IHT.
Beyond personal tax concerns, the report also revealed that the tax is considered a burden on the UK economy. More than two fifths (43%) say the tax is holding the economy back, up from 23% before the last Budget.
Despite this, the report found that 83% expect taxes to rise further in the next 12 months, with capital gains tax (38%), income tax (37%) and inheritance tax (35%) cited as the most likely to increase.
Mike Stimpson, partner at Saltus, said: “The expectation of further tax rises, particularly around inheritance tax, is raising alarm among high-net-worth individuals, who play a crucial role in the UK economy as business owners, employers and investors.
“This tax makes the UK a relatively unattractive location for people who create wealth. As the Chancellor’s Spring Forecast approaches, there is growing pressure for meaningful reform, but it remains to be seen whether the Government will address these concerns or press ahead with further tax increases.”
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