If inheritance tax is to be retained, it urgently needs to be improved. The current system suffers from several problems which are costly, inequitable and inefficient. And as inheritances grow, these problems become more prevalent. There are several clear steps the government could take to make the system better. These could raise additional revenue, or could be combined with a lower inheritance tax rate or higher threshold as part of a revenue-neutral reform.

These are among the findings of Reforming inheritance tax, by Arun Advani and David Sturrock, published today as a pre-released chapter of the 2023 IFS Green Budget, produced in association with Citi and with funding from the Nuffield Foundation.