UK investors believe cuts to income and corporation tax rather than inheritance tax (IHT) would have a greater boost for the wider economy.

This is a despite a survey from Wealth Club also revealing that IHT remains the tax that investors dislike the most.

A survey based on 431 Wealth Club clients by the high-net-worth investment broker indicated that 33% of investors would still like to see IHT reform in the upcoming Budget, if just one tax is to be cut. This came in just ahead of income tax, which 27% of investors said they would like to see cut.

IHT was also particularly unpopular with entrepreneurs, with 40% of entrepreneurs surveyed favouring a cut in this over any other tax.

However, when asked which tax cuts they thought would be most effective at sparking economic growth, investors backed cuts to income tax (29%), corporation tax (23%) and business rates (13%). Only 3% of respondents backed a cut to IHT to spark economic growth.

When asked which policies they would introduce, investors who focused on IHT also generally preferred to make tweaks rather than abolish the tax altogether. Suggestions included reducing the tax rate from 40%, or increasing the threshold at which it applies.

“IHT remains the least popular tax with wealthy investors – and the one they would most like to see cut at the Budget,” said investment manager at Wealth Club, Nicholas Hyett.

“However, the Government would do well to note that many wealthy voters would favour tweaking the rules around the UK’s most hated tax rather than abolishing it altogether. Cutting the rate at which IHT is charged, or raising the value of the estates on which it is applied could deliver a popular tax cut without completely discarding a valuable source of tax revenue.

“However, it seems likely that wealthy investors would also back a decision to focus on tax cuts in areas like income tax, corporation tax and business rates – all of which are seen as having the potential to boost the wider economy.”

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