When "Tax Day" was first announced by the Chancellor, it seemed to have ominous overtones - were we in for an annual dropping of tax bombshells? Fortunately, Tax Day has not lived up to the anxious hype. Indeed, in this Autumn's iteration (which took place yesterday), confirmation was provided that, for now, at least, the government has no intention of considering further the significant changes to either inheritance tax (IHT) or capital gains tax (CGT) which had been proposed by the Office of Tax Simplification (OTS) in the last few years.

The OTS had proposed a wide range of significant changes to both taxes. For CGT, there were proposals to align the tax rates more closely with those for income tax (i.e. to increase them, possibly significantly) and to reduce the current annual allowance which means that the vast majority of the UK population do not pay CGT in any given tax year. As concerns IHT the suggested changes mainly focussed on the current array of exemptions and reliefs, which are generally perceived to be overly complicated. The reliefs available where business or agricultural property is held by the deceased, and certain lifetime gifts such as those made by way of "normal expenditure out of income", were seen as likely targets for reform or even removal.

The letter from the Financial Secretary to the Treasury to the OTS makes it clear that this is a "not now" rather than a "not ever". The door is certainly left open for these options to be considered, probably in the context of wider reform of one or both taxes, at some point in the future (one would imagine, after the next election). However, the Treasury acknowledges that there are a wide variety of viewpoints on what to do about reform to either tax and, with the recent freezing of the IHT nil-rate bands until the end of 2025-6, the freezing of income tax bands and introduction of the Health and Social Care Levy, it seems the government has decided not to change the existing tax landscape too much further for now. With a promise though to the OTS to "bear your very valuable work in mind if the government considers reform of IHT in the future", it appears that, if these reforms are reconsidered in the next Parliament, they won't be going back to the drawing board. Those considering their estate planning options may therefore wish to continue to have regard to the OTS proposals when structuring their affairs and considering investment asset classes over the next few years.