There are a few issues here. First, having a subset of gilts subject to their own particular tax treatment would fragment the market, making it shallower and less liquid. Second, and more importantly, lower interest costs in the short term would be offset by lower inheritance tax receipts later. It’s not a free lunch, even if it might appear that way to a short-termist government more focused on the near-term interest savings than the long-term loss in tax revenues. And third, as I’ll come back to, however it’s badged, additional borrowing is still additional borrowing.