George Osborne is not for turning on inheritance tax

The Tory Treasury team has tonight gone on to the front foot with an attack on Labour's inheritance tax policy. More significantly, in terms of General Election strategy, George Osborne is signalling a determination to stick with the Conservatives' own IHT pledge and to position the party as the champion of aspiration and family.

Conservative research suggests that more than four million people are liable for Inheritance Tax, "even after taking into account the transferability of Inheritance Tax allowances between married couples by allocating the full £325,000 allowance to each adult."

Shadow Chief Secretary to the Treasury Philip Hammond, commented:

“These figures show that Inheritance Tax remains a threat for millions of families under Labour. Coming on top of the Government’s planned tax increase on anyone earning over £20,000 this reveals that the real victims of Labour’s class war are middle-income families. If you aspire to save for your future and pass something on to your children then Labour is no longer the party for you. The Conservatives will restore Inheritance Tax to what it was designed to be – a tax on the very rich – and ensure that it is only paid by millionaires.”

The Tory pledge to abolish inheritance tax for all but millionaires has been a big target of Labour attack dogs. They have used the pledge to try and paint the Conservatives as 'friends of the rich'.  There have also been suggestions that the pledge is unaffordable given the budget deficit.

A recent poll by ComRes suggested that the Tory policy still enjoyed support from voters.  By 55% to 38% respondents told ComRes that they supported the policy of raising the inheritance tax threshold to £1m.

Decisive in the hardening of the Tory position has been a concern to avoid a reputation for flip-floppery. The Tory vote softened immediately after David Cameron was (unfairly) perceived to have broken his pledge on the Lisbon referendum.  George Osborne as General Election co-ordinator and Shadow Chancellor is determined to avoid giving The Daily Mail any more cause for concern. The Shadow Chancellor is not for turning!

Tim Montgomerie