Budget Statement

Lord Campbell-Savours Excerpts

Friday 12th March 2021 Lords Chamber

[Lord Campbell-Savours (Lab) [V]]

My Lords, I strongly support the proposal from the noble Lord, Lord Rooker. I shall concentrate my remarks on inheritance taxes. The Budget statement proposes a freeze on nil-rate bands until April 2026. This means qualifying estates can pass on up to £500,000, and the qualifying estate of a surviving spouse or civil partner can pass on up to £1 million, without tax.

On 1 February 2007, I proposed an amendment to the law governing inheritance taxes. I proposed then—and do so again today—that we use inheritance tax on death as an opportunity for the wider distribution of wealth with a substantial increase in net beneficiaries. We should abolish the tax completely, transfer the liability to tax from the deceased estate to the recipients, and tax the recipient beneficiaries at their marginal rate. We could introduce an inheritance allowance, thereby increasing a recipient individual’s tax threshold. Inter-spouse transfers would remain tax-free, as would protections for working farms and family businesses, as well as donations to genuine charities and some heritage assets.

This reform would transform the recipient base as many estates would be tapered, or profiled, to minimise liability. A wider beneficiary base would have a huge effect on enterprise and innovation by introducing a real incentive for the development of small businesses with knock-on consequences for competition policy. It would also increase the tax take. I make it clear once again that there are no circumstances under which either I or my wife would accept, or have accepted, inherited wealth. This was a decision taken in principle to last a lifetime, at considerable cost to myself, I might say.