Alistair Darling is facing the probability of freezing inheritance tax to increase tax revenue for the government because of the drops in house prices. But with house prices rising this could mean that more people will have to pay for the mistakes of Labour's mismanagement of the economy through inheritance tax.
Inheritance tax used to be the tax of the rich but after the house price boom but more and moreÂ people find themselves eligible for inheritance tax having to pay out huge sums of money after the death of loved ones because the housing boom was not curtailed. So now that house prices are on the up again we must ask the question 'who benefits from an over inflated property market?'
It most certainly isn't the next generation of home buyers and it isn't the families of the deceased who face an inheritance tax bill. We must remember that a house is a home and not some financial tool to make us rich.
So for a brief time the only people who profited from the housing boom were estate agents, lenders, the construction industry and property developers.
But by the definition of a boom there must be a bust and those aforementioned professions who did not factor in house price falls have payed a very high price as did those who bought at peak and have now found themselves in negative equity.
When you hear senior bankers and politicians telling you that no one could have foreseen the credit crisis and economic downturn I question their integrity. I have spoken to many city workers, traders and investors alike and they all give the same response when asked if they had any idea that the financial sector was acting recklessly.
They answer 'yes'.
For the past five years I have researched the housing market and in doing so I came across many internet sites that gave a very different picture of the economy and warned of the impending disaster facing our economy.
They were branded nuts and alarmist by the media yet they were right. So if they were right and the government and senior bankers with their wealth ofÂ advisers and analystsÂ say could not foresee the crisis we now find ourselves in but a few bloggers on the internet called it right, then I am sorry but I for one do not buy that argument.
If the aim of the government is to protect home owners then freezing inheritance tax removes the incentive for purchasing a family home when you can rent a property with lower monthly expenditure than you would face with a mortgage only for your children to pick up a bill from the government.
Why not put money aside for your children? It makes more sense than throwing your disposable income into a mortgage on a property that either the tax man will take a chunk out of if you die or the residential home will deplete if you find you are unable to look after yourself in your twilight years.
For those who say inheritance tax is a fair tax I would say this.
It is fair providing it does not include those on lower or middle incomes.
The rich will always make provision for the tax man and find a loophole leaving the tax burden falling squarely on the shoulders of ordinary working people so the inheritance tax threshold should increase to accommodate the impact of the housing boom.