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Delegates told IHT should stay but be made fairer

The LibDems will not advocate scrapping inheritance tax but are looking at measures such as axing the gift rules in an attempt to make the tax fairer.

Speaking at a tax commission debate in Brighton, Shadow Chancellor Vince Cable said the basic principles of IHT were “hard to quarrel with” but he would be looking at measures to ensure the richest could not escape the tax.

Cable said IHT policy was a conspicuous hole in current LibDem thinking and the party needed more time to come up with well thought-out reforms.

He suggested that the tax had wide consensus across the political spectrum but a major worry was the perception that the wealthiest could get round the tax by using advisers and accountants.

Cable told delegates that one measure he would be looking at was amending the rules on gifts, which are currently free of IHT after seven years, and gift trusts.

He said policy announcements in this area would be announced within the next year.

Cable said: “I do accept the principles of IHT. The problem is certain well-off people can find a way around it. The question is what do you do about it? To scrap it would be very costly.

“Can we get rid of gift rules and trusts? We need more time to look at this work.”

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