Inheritance tax hike looms as Andy Burnham allies plot raids to hammer 'the rich'

By GLEN OWEN

Published: 22:02 BST, 11 July 2026 | Updated: 22:19 BST, 11 July 2026

Grieving relatives could be hit with a sharp rise in inheritance tax as part of a package of wealth taxes being considered by Andy Burnham.

Allies of Mr Burnham, who will walk through the doors of No 10 in just over a week's time, are understood to be studying a raft of proposals, which would hammer the rich – and hammer them again if they try to leave the country as a result.

Media outlets were briefed this weekend that Mr Burnham was considering tax cuts for low earners after entering Downing Street in order to start his premiership with a 'message of hope'. Other options to reduce the cost of living include lower energy bills and bus fares.

But with the Government facing spiralling bills for welfare, defence and other public spending commitments such as the nationalisation of water companies, extra money will have to be found from somewhere.

Mr Burnham has fuelled speculation by saying that there was 'some room' in Labour's manifesto – which ruled out rises in National Insurance, the basic, higher, or additional rates of income tax, or VAT – for some 'movement on tax'.

Some of the potential tax options were endorsed by the Labour-linked Institute for Public Policy Research in 2024, as part of a Commission on Health on which Mr Burnham sat.

After citing links between poor health and inequalities of income, the report suggested raising money for initiatives such as subsidising healthy foods by increasing inheritance tax – which is payable on the amount by which estates exceed £325,000 – from 40 to 50 per cent, to raise £1.9 billion per year.

Advisers to Mr Burnham have also suggested replacing income tax, capital gains tax, inheritance tax and National Insurance contributions, with a single levy, with these 'national contributions' to be paid on all income, regardless of whether they were from work, the sale of assets or from a late relative's estate.

Andy Burnham, MP for Makerfield, arrives for a radio interview on LBC's 'Tonight with Andrew Marr' on July 2

View gallery Former Labour leader Neil Kinnock speaks at Parliament Square, London, on June 20

Daily Mail report