New research has today revealed how Jeremy Corbyn’s Family Homes Tax plans will hit 3.9 million homes across England and Wales.
Under Corbyn’s plans to reduce the inheritance tax threshold to £425,000, 3.9 million of the 25 million homes in England and Wales would be dragged into the Family Homes Tax.
The analysis also finds that because of house price rises a further 1 million homes would be forced to pay the tax over the next five years – taking the total to 4.9 million properties, just under 20% of all the homes in England and Wales.
Town and cities all across the country will be hit hard by Corbyn’s plans to hike up inheritance tax.
An estimated 51 per cent of London’s homes – a total of 1.8 million of London’s 3.5 million houses – will become liable for inheritance tax under Labour’s plans.
In Jeremy Corbyn’s own backyard of Islington, three out of four families would have to pay the 40 per cent tax on the value of their deceased relative’s home and estate above the tax threshold.
In Oxford 38.7% of the 60,200 homes in the area will be hit by the Family Homes Tax.
In St Albans it will be 61.1%, Cambridge it will be 48%, in Chichester 34.7%, Brighton and Hove 27.8% and Bath and NE Somerset 26.4%.
Elsewhere, 21.4% of Harrogate’s 71,040 properties will be hit by the Family Homes Tax, while Warwick 19.7% of 61,740 will be affected.
If house prices were just to rise in line with forecast inflation over the next five years, then by 2022, 61 per cent of all homes in London (2.1 million homes) would be liable for inheritance tax. Across England and Wales, 4.9 million homes (19.4 per cent) of all homes would be liable.
By contrast, Conservatives have already changed the law to increase automatically the thresholds between 2017 and 2021, so fewer families are caught by inheritance tax.
The Conservatives raised the inheritance tax threshold to £850,000 and it will continue to go up, reaching £1million by 2021.
Philip Hammond, the Chancellor, said: “Jeremy Corbyn wants to hit family homes with a bombshell of new taxes. Ordinary families across the country will suffer because of his nonsensical policies.
“People who have worked hard all their lives, saved and improved their homes will now be hit with this punishing Family Homes Tax.
“Jeremy Corbyn would wreck the economy. The manifesto he unveiled on Tuesday contained a £58billion black hole in its spending plans.
“It is clear that the Family Homes Tax is only the beginning. If Corbyn, in a coalition of chaos propped up by the Lib Dems and the SNP, gets the keys to Downing Street it will mean higher taxes for families across the country.
“Only a vote for Theresa May and her local Conservatives will stop people being hit by this punishing Family Homes Tax.”
Liberal Democrats have already backed Labour plans for higher inheritance tax, opposing what Conservatives have done to take family homes out of the tax since 2015.
Liberal Democrats’ 2017 manifesto states: ‘We would reverse a number of the Conservatives’ unfair and unjustified tax cuts, including: … The raising of the Inheritance Tax threshold’ (p.40).