Inheritance Tax

Debate between Jon Trickett and Peter Gibson

Wednesday 17th January 2024 Westminster Hall

[Jon Trickett]

No, I will not give way—the right hon. Gentleman will have a chance to speak in a moment.

I want to illustrate what is happening. I think I am right in saying that, if inheritance tax were abolished, it would put £12 million back into the Minister’s constituency, which makes £60 million in a five-year Parliament. In all the 42 red wall seats in the north of England, which went from Labour to Tory, that sum is hardly more. All those seats together would raise £15 million a year in inheritance tax. Abolishing inheritance tax would put a fraction of the amount of wealth in our country back into those constituencies, and then only into the hands of the richest in our society.

[Peter Gibson (Darlington) (Con)]

Will the hon. Member give way?

[Jon Trickett]

I will give way, but briefly, because I want to make progress.

[Peter Gibson]

I am grateful to the hon. Gentleman for giving way. I am following his logic about money staying in a constituency where inheritance tax falls, but that presupposes that all beneficiaries of that deceased’s estate live and reside in that constituency, which is not the case. Beneficiaries often live throughout the country.

[Jon Trickett]

The hon. Gentleman raises an important issue, because I think there is £800 billion of wealth in our country that nobody—not even the Treasury—knows the owners of. That is a colossal, unimaginable amount of untaxed wealth, which has simply disappeared because the Treasury cannot find out who owns it. It is true that people can reside in one place and own property in another, but I am talking about someone’s place of residence when they died.

Let me remind Members of the figures, because I do not want to lose the argument. In all of the red wall seats that Labour lost to the Tories, £15 million in inheritance tax was paid; only in three of those seats did anyone pay any inheritance tax. However, in the 42 blue wall seats that I have looked at, £1.5 billion was paid in inheritance tax. So in Tory seats in the south and south-east, and to some extent in London, £1.5 billion was paid, while only £15 million was paid in all of the so-called northern red wall. That is a completely extraordinary set of figures.

I think Ministers and right-wing commentators really fail to understand the way in which our society is structured, with the inequalities and all the other problems that we face on a daily basis. If it were to happen, the abolition of inheritance tax would be one of the largest shifts of wealth that has ever taken place under any Chancellor, certainly in recent history. I have been in Parliament for 28 years and I do not remember anything as large. Here is the central point: this is not a fiscal strategy, and it is not about justice, or fairness, or responding to what the people of the country want. It is a political strategy to move money into those areas where the Tories are now extremely worried that they are going to lose their seats. This is about pumping money into blue wall seats. It is a political strategy rather than a fiscal one.

That is where we are. The Government think that they can bung people, whether with contracts or honours or by putting money back into the pockets of the richest people in our society, in order to secure their own continuance in office. But the British people do not like this stuff. It is grossly unfair and it should not be happening. I hope that the Minister can say, “Well, we might have had a look at it, but we’re not going to do it, because—you’re correct—it would be unfair.”