The Conservatives have pledged £3bn in tax cuts to more than triple the inheritance tax threshold to £1m and double the stamp duty threshold to £250,000 for first-time buyers, with both policies being paid for by a £25,000 annual flat tax on non-domiciles.
The present IHT threshold is £300,000 and for stamp duty it is £125,000.
At the Tory conference in Blackpool on Monday, Sha-dow Chancellor George Osborne said the two moves represent the “most important reform of capital taxes for a generation”.
The Conservatives say the move on stamp duty will mean 90 per cent of first-time buyers will not pay any stamp duty, with a cost to the tax-payer of £400m.
Osborne said the IHT commitment would cost £3.1bn while the levy move on non-domiciled residents would raise £3.5bn on a conservative estimate that 150,000 people would pay the levy.
The Government has attacked the plans, saying the Tories have got their sums wrong about non-domiciled status, claiming that the levy would only raise £650m a year as many non-doms would not pay it.
A Skandia spokesman says the firm supports a rise in the IHT threshold but the Conservative plans involve a shift from tax revenue that the Government is certain of to revenue that they cannot be sure they can collect.
But the Tories have hit back, stating that consultancy Grant Thornton and the Confederation of British Industry believe the majority of non-doms do not see £25,000 as a significant sum and would be willing to pay it as a way of clarifying their position and removing uncertainty.
The Conservatives have also rejected suggestions from the Treasury that the plan would create problems for US citi-zens with their American tax arrangements.
Osborne said: “Brown told you he would look after your pension then he launched his £100bn raid on savers. The nation’s bank manager who cost us all £2.5bn by selling our gold at a record low, when it has now reached a record high. Gordon Brown, the nation’s bank manger. Let’s start queuing round the corner to close our account.”