Scrapping inheritance tax would cost £15bn a year by 2032, says IFS

Rishi Sunak was understood to be considering an inheritance tax cut as he attempts to woo voters. Photograph: WPA/Getty

Scrapping inheritance tax would cost the government almost £15bn a year in lost revenue by 2032, according to analysis by the Institute for Fiscal Studies that follows calls from Tory MPs for the main tax on inherited wealth to be abolished.

The thinktank said the latest figures from HMRC showed fewer than 4% of estates paid inheritance tax (IHT) in 2020–21, but the rapid growth in wealth among older individuals meant this number was set to rise to more than 7% over the next decade.