Outlook: Widows and tax

IT SEEMS that the taxman is going to have his pound of flesh from the Scottish Widows sale after all. It is anyone's guess how big the Exchequer's take will be from the payouts due to 900,000 with-profits policyholders, but pounds 500m is as reasonable an estimate as any.

Widows has decided that the biggest rewards will go to those who have held policies the longest even though it is those who have been with the insurer for the shortest time who will be most disadvantaged by the decision to abandon mutuality. Short of scrapping the sale, which it won't, Widows could at least make the distribution of the windfalls more even, and thus help to keep more of the proceeds in policyholders' hands and less in Gordon Brown's pockets.