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\t\tThe Treasury will need to take in more than \u00a350bn in new taxes at the next Budget in the Autumn to avoid breaking the government\u2019s fiscal rules. \t<\/p>\n
Rachel Reeves is exploring measures to extract more revenue from inheritance tax (IHT) ahead of the Autumn Budget, as she looks to plug a massive fiscal blackhole without breaking Labour election promises on tax.\u00a0<\/p>\n
According to a report in The Guardian<\/a>, the Treasury is looking into changes to thresholds as well as tightening the rules around using gifts of money to get around IHT.\u00a0<\/p>\n The unpopular levy on estates has been consistently exploited as a means of taking in additional revenue to fund spending without directly raising headline taxes on individuals.\u00a0<\/p>\n Currently, cash gifts are exempt from the tax as long as they are made more than seven years before someone dies. Then, gifts made within three to seven years are taxed based on how close they are to death.\u00a0<\/p>\n The Treasury will need to take in more than \u00a350bn<\/a> in new taxes at the next Budget in the Autumn to avoid breaking the government\u2019s fiscal rules.\u00a0<\/p>\n Inheritance tax takings on the up<\/p>\n As part of its winning general election campaign last year, the Labour Party ran on its \u2018Stability Rule, that all day-to-day government spending would be funded solely by tax revenue by the end of the decade.\u00a0<\/p>\n Though the government has pledged not to raise taxes on \u2018working people\u2019, the definition of what \u2018working people\u2019 means has been slippery.<\/a>\u00a0<\/p>\n City AM reported in July that IHT takings had surpassed \u00a36.7bn in the 2022\/23 financial year<\/a>, before Reeves even took the reins at the Treasury.\u00a0<\/p>\n