The Inheritance Tax threshold is increased from 6 April 2003 to £255,000 (2002/03: £250,000). It is estimated that only about 5% of deceased's estates have to pay the tax (which is an increase of 1% from last year).

The rates of tax remain unchanged at 40% for transfers on death and within three years of death, and a tapered rate for transfers over three and less than seven years before death. The rate for transfers which are chargeable during lifetime remains 20%.

In spite of regular predictions from professionals that the Chancellor will one day tighten up the IHT rules, there were yet again no significant changes to the tax.