John McDonnell was accused of a tax raid on Londoners today after claims that eight in 10 homes would be hit by a planned levy on children given property by their parents.
Tories calculated that nearly three million homes in greater London would be liable for the lifetime gifts tax that the shadow chancellor has confirmed is being studied.
Under the plan, the current minimum threshold for taxing wealth passed down by parents would be slashed from £475,000 to £125,000 and would apply to all gifts made during a child’s lifetime, rather than just property inherited after death.
A Tory analysis found that the London region would be affected more than any other because of the sky-high value of properties, with 77 per cent of homes — some 2,771,905 properties — fitting into the £250,000 to £1 million price bracket.
Mr McDonnell said: “We need to have a fairer system of ensuring that wealth is more fairly distributed.” But Tory chair Brandon Lewis said: “Three quarters of homes could be liable for Labour’s tax grab, hammering families who have made a home in London.”
