Commenting on the Stamp Duty and Inheritance Tax Thresholds, Tim Crawford, group economist at Halifax, said: "Whilst we welcome the increase in the inheritance tax threshold announced today, we would have liked to have seen the thresholds for both inheritance tax and stamp duty adjusted to reflect the significant increase in house prices in the past decade.
The thresholds at which inheritance tax and, particularly the higher stamp duty bands, are levied have lagged well behind the increase in house prices over the past decade. "
Anne Young, Technical Director at Scottish Widows, said:
The inheritance tax (IHT) nil rate band threshold will increase to £300,000 on 6 April 2007 as forecast in previous Budgets and will increase in stages to £350,000 in 2010/11. While this increase from £285,000 in 2006/07 is to be welcomed, it will still leave many people with a potential IHT problem as house prices are currently increasing at a higher rate than is the threshold. People need to add up the value of their assets and do a rough calculation to see if they have a potential problem when they die. Some simple steps can be taken in many cases to side-step or even avoid a charge. It is important that advice is taken in good time.
Barry Naisbitt, chief economist at Abbey, said:
"The increase in the inheritance tax threshold from £285,000 to £350,000 by 2010 is certainly a move that most will welcome. However very many people - particularly those who have owned their own home for 5-10 years or more - now have substantial assets as the value of their homes have risen significantly. To account for that rise completely, the Chancellor would have had to increase the IHT threshold to around £460,000. So this is an issue many hope will be revisited next year."
Robert Bryant-Pearson, chief executive of Allied Surveyors, added:
“We welcome the Chancellor’s decision to allow grants of up to £4,000 for pensioners to install central heating and insulation in their homes. This will add to the value of their principal asset and make these homes more saleable.
“However, Mr Brown’s decision to offer grants for micro-generation in private homes seems to be more about political posturing rather than really tackling the green agenda.”
David Bexon, managing director, SmartNewHomes.com responded to Gordon Brown’s pledge to make all carbon zero homes under £500,000 exempt from stamp duty until 2012. He said:
“I welcome any initiative that aims to cut carbon emissions and encourage the future development of zero carbon homes across the UK.
“However, I fear that Government’s latest pledge of stamp duty exemption is nothing more than an empty gesture if earlier admissions from the Treasury are true, that there are currently only 24 carbon zero homes in the UK.”
