My business week: Jonathan Ivinson

Jonathan Ivinson sees the return of 'back to basics'

One interesting detail in the measures to reform inheritance tax (IHT) announced in the pre-Budget report was the restriction to married couples of the higher IHT exemption threshold. In an interview with 'The Daily Telegraph', the Chief Secretary to the Treasury, Andy Burnham, claimed there was "a moral case for promoting marriage" in the tax system.

Perhaps Mr Burnham, following his Chancellor's lead, decided this was a piece of new Conservative thinking that was playing well in Middle England. In case we don't quite get the link here between estate taxes and moral policy, he adds that marriage "is better for kids". So make no mistake; this is lower tax offered as a reward for choosing marriage. Clearly it is back-to-basics time for British fiscal policy.

To extend the basis for calculating tax obligations from an individual's personal income to include the nature and legal status of their personal relationships is to go back to the days before independent taxation, when assessment was carried out household by household. It inevitably raises difficult questions as to why certain classes of taxpayer should pay more or less than others. It also expands the remit of the tax inspector from a concern with bank accounts to the comings and goings at private addresses.

People do not generally organise their personal lives on the advice of tax lawyers and accountants, and they are highly unlikely to do so for the sake of an inconsequential tax cut. So the chances of achieving a particular demographic outcome from policies like these are practically zero. Which makes you wonder why we have this strange discriminatory quirk in the IHT legislation. Surely not a case of spin over substance?

Jonathan Ivinson is an international tax lawyer and partner at Hogan & Hartson. www.hhlaw.com