May's social care pledge could be huge wealth taxpublished at 13:43 British Summer Time 19 May 2017
Simon Jack
BBC Business Editor
The fizz in the Conservative Club gin and tonics may taste a little flat this weekend as folks realise that they have just been hit with potentially the biggest new wealth tax of all time.
The Tory manifesto pledge to use accumulated property wealth to fund the escalating price of in-home social care bill will be welcomed by many as a bold attempt to tackle one of the greatest problems of our age. Others will see it as a huge and risky departure from traditional Tory policy.
I merely argue that it has profound implications for the intergenerational economic structure and is likely to trigger a number of unintended and unexpected consequences for financial services and families.
Just how profoundly it will affect you is a lottery with several variables. If you just drop dead one day, you are fine (!) if it happens before you need social care. If your house is worth less than £100,000, you are also fine. The Tory proposal allows you to keep the last £100,000 of your estate.
However, if you live in the South East, have a home worth £500,000 and you need long-term care, you could end up paying 80% of the value of your home to fund it - which may be a big disappointment to your offspring.
There are some enormous questions to answer.
May's social care pledge could be huge wealth tax
A complex shake-up proposed for social care could pit generations against each other.
Read More