Labour’s plan would “destroy enterprise” by allowing the state to “help itself to whatever it chooses’, claimed Nick Ferrari. The Brexiteer also warned the tax could extend to a parent buying their child “a coffee at the shops” too. Speaking on Sky News’ The Pledge, Mr Ferrari said: “As the two Conservative leadership candidates continue to talk about giving out countless billions of cash, as if they were hosting a warped version of supermarkets sweep.

“The Labour Party has quietly and frighteningly been exploring other economic initiatives. One of which is a lifetime gifts tax.

“Under this you will pay tax on everything your parents gave you while alive or after they die, over the value of £125,000.

“This presumably means we must keep a tab on all the gifts we receive from mum and dad down the years.

“Plus any cash handouts when we get married or buy our first house or car, possibly even when mum buys you a coffee at the shops as well.

“The current inheritance tax system is iniquitous enough, but this idea the state can help itself to whatever it chooses is evil and destroys enterprise. Seeking to leave something to your children is a basic human instinct.

“This is straight out of the Hugo Chavez playbook in Venezuela, and we all know what happened there.”

Inheritance tax could be scrapped under the Labour Party, Shadow Chancellor John McDonnell has implied.

He signalled interest in a plan for the abolition of Inheritance Tax, instead being replaced by a “lifetime gifts tax”.

Under the new plans, everything a recipient receives above £125,000 would be taxed annually at income tax rates.

Speaking on the Sky News programme Sophy Ridge on Sunday, the Shadow Chancellor he said: “We are looking at it and it might be one of those ideas, and we’re consulting on it at the moment.”

He continued: “I think it’s interesting. We need to have a fairer system of how we can ensure that wealth is more fairly distributed, that’s one idea and we are listening to a whole range of ideas.”

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It came following the release of the Land for the Many report, commissioned by the Labour Party.

The Resolution Foundation – who recently proposed the reform, as did the Institute for Public Policy Research (IPPR) – estimate that taxing gifts through the income system would raise £15 billion in 2020/21 – £9.2 billion more than the current system.

A spokesperson said: “We welcome this independent report by a group of experts. As the report makes clear, Britain is a deeply unequal country and we need to start addressing that.

“Rent controls and tighter restrictions on the ability of landlords to evict renters on spurious grounds are essential to rebalance a rental market which often leaves tenants powerless.

“House price stabilisation is not Labour policy, but with home ownership at a 30-year low, it is clear there is a desperate need to tackle runaway house prices.”

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