Newspaper article The Evening Standard (London, England)

This Huge Betrayal of Trust by Brown

Newspaper article The Evening Standard (London, England)

This Huge Betrayal of Trust by Brown

Article excerpt


OF ALL the vindictive, thoughtless and brutal measures imposed by this Chancellor, the attack on trusts is among the worst. We have become used to Gordon Brown's devaluation of Budget speeches from an explanation of proposed new measures into a party political rant, but the contempt shown to his audience this time marks a new low.

While he could bang on about a footling [pounds sterling]2 million initiative for kiddies' football, there was not a word about the attack on trusts, while the press releases from HM Revenue & Customs gave no clue why reform was necessary or what the policy objective was. The guidance note with the Finance Bill, couched in suitably wounded tones, explains that the new measure is not designed to catch the millions of life assurance policies written in trust, and claims that the Bill provides "complete certainty" about the scope of the new rules.

Well, not to the experts who have spent two years talking to the authorities about proposed changes to trust law. Even the mild-mannered Financial Times describes the lack of consultation as "gratuitous and offensive".

The Revenue's protests that the new rules are aimed at the rich who are exploiting the existing rules look disingenuous. On the Treasury's forecasts the changes will raise just [pounds sterling]15 million, enough to pay for a few minutes' public spending. It's less than the increase in profits declared yesterday by Grosvenor Estates, the vehicle of Britain's richest private landlord, the Duke of Westminster.

If the measure were to catch the likes of him, the yield would be 10 times as much. It won't, of course.

As usual, the people affected will be those of modest wealth in the middle classes.

The use of basic accumulation and maintenance trusts is routine, widespread and (until now) considered a perfectly acceptable means of tax management. …

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