Tax fractures in the Labour party: Balls refuses to back Miliband’s “deed of variation”

 

Shadow chancellor Ed Balls has refused to condone Ed Miliband's use of a tax loophole to avoid paying full inheritance tax. 

 

The Labour leader and his family reportedly adopted the “deed of variation” when posthumously changing the will of Ralph Miliband, Ed's father. This allowed them to not pay full inheritance tax on a property left to Ed's mother, Marion. 

 

But Balls said that if Labour comes to power after the general election in May, he might ban this practice along with many others in an attempt to stop “systematic tax evasion”.

 

“I will look at every area. The intention of Parliament must be delivered," he said during an interview on the BBC's Andrew Marr Show. The party plans to put into action a wide-ranging assessment of all possible tax loopholes in financial planning. 

 

The row over Miliband's actions centres on the North London property he and his brother David grew up in. By changing Ralph's will so that it was not left entirely to Marion, but rather 60 per cent to Marion, 20 per cent to David and 20 per cent to Ed, it meant Marion had to pay lower inheritance tax on the estate overall. 

 

Balls did not outright condemn Miliband's actions however – he added that he thought Ed had “paid all the tax that was due”. According to The Telegraph, Miliband says he made up for this by paying capital gains tax when he sold his share of the house.