'Don't let Labour do damage' Sunak urged to scrap inheritance tax before Starmer's 'madcap spending plans'

Writing in the Telegraph, he said the best approach is to "take money out of the hands of the government and put it in the hands of individuals, who always spend it better and more effectively".

The Tory peer and former Brexit minister noted that one-third of the 36 OECD members levy no wealth transfer tax at all, so "getting rid of it won’t make us an outlier".

WATCH NOW: Rees-Mogg says inheritance tax should be scrapped

Warning the Government against simply "tinkering" with the tax, Frost said: "Instead, find the necessary savings and scrap the tax.

"Then fire the officials who collect it, destroy the records, and plough salt into the earth so it can never come back. And do it soon. "

Yesterday it was revealed that Starmer is eyeing a "devastating" raid on inheritance tax, in order to close loopholes in the levy.

The party is looking at getting rid of two key exemptions, which currently apply to agricultural and business properties.

The exemptions allow farms and businesses to be passed down without the 40 per cent inheritance tax charge applying.

Removing the two exemptions are expected to raise as much as £4 billion, according to the Times.

But Sean McCann of the financial advice firm NFU Mutual warned that the changes would have a damaging effect on the UK's family farms.

He said: "Removing Agricultural Property Relief could be devastating for the UK’s traditional family farms.

"Financial returns from agriculture can be lower than many other businesses. Agricultural Property Relief enables farmers to invest in their long-term future with the knowledge their farm is sustainable for the next generation.

"Similarly, removing Business Property Relief would be a significant disincentive to business owners, and is likely to mean that in many cases the next generation would need to borrow significant sums to pay the tax, rather than to invest in future growth and jobs."

This comes amid reports that Rishi Sunak is planning to scrap the tax altogether.

Inheritance tax is paid on estates worth over £325,000.

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Discussions are said to be taking place within the Government about changes to the tax at the next manifesto ahead of next year's election.

While Chancellor Jeremy Hunt has said there is no room for tax cuts, Defence Secretary Grant Shapps this week described inheritance tax as "deeply unfair" and "punitive".

He said: "I think it’s a question, for many people, of aspiration, and people know that there’s something deeply unfair about being taxed all their lives and then being taxed in death as well."

An influential backbencher told GB News that the UK is unlikely to see immediate inheritance tax cuts at the Autumn Statement, but they could be included in the manifesto ahead of the next general election - expected to take place next May.