What's the logic of inheritance tax?
Discussion
Interesting, as a bunch of fans of lumpy camshafts and tyre smoke, we have arrived at our present states from 2 different backgrounds. The strugglers and the non-strugglers. It is interesting to see how we feel relative to our richer/poorer chums. For instance, I look at the 18 year old with a ferrari and thing WOW! I see the wage slaves and think "poor bastards" 
Yeah, I'm jealous of people with more than me so I think there should be an inheritance tax of 100% with a threshold of......let me think, what do I stand to inherit????
Since a lot of small properties have gardens of various sizes, due to building regs/planning permission, there is no chance of the land being developed, and so it is worth little. A "gift" of a few acres should not be noticed, however, when the house is come to be valued upon death of the owner. The land being owned by a third party would mean the house was woth CONSIDERABLY less. Hmmmmmmm......
Yeah, I'm jealous of people with more than me so I think there should be an inheritance tax of 100% with a threshold of......let me think, what do I stand to inherit????
Since a lot of small properties have gardens of various sizes, due to building regs/planning permission, there is no chance of the land being developed, and so it is worth little. A "gift" of a few acres should not be noticed, however, when the house is come to be valued upon death of the owner. The land being owned by a third party would mean the house was woth CONSIDERABLY less. Hmmmmmmm......
vixpy1 said:
Did read the post Ben... I was refering to the Socialist ideal that everyone is born equal..
Erm, that's not a socialist ideal, it's just a great desire for us not to have some kind of pseudo-Arian uber-race thinking they have some God given right to this once fair isle over and above everyone else. And that applies to scutters in the future leaving closets full of priceless antique Burberry chav-wear to fund future generations superior ability to eternally sport timeless "classics" as much as it does an ancestral gothic mansion with real worth.
bertie said:I think that is exactly what is happening, the ones with money are leaving, the ones without are replacing them. If the UK was a company I would be looking to get rid of my shares sooner rather than later.
The danger here is that if you don't let people be sucessful by imposing cripling tax regimes, they all bugger off to somewhere else, as many people including JSG have suggested they will do, and you're left with a country full of dead heads and drop outs.
Ivan
Lots of stuff here about IHT being unfair or immoral.
But then, what is a fair or moral tax?
The government, and civil service, exist, and cost money. There are two sides to this; raising the money, and spending it. Generally, government finances are dictated by how much they want to spend, since they can pretty much rasie what they want. (40%+ of GDP?)
This money has to be raised from the general populace. There is nothing implicit or explicit in fairness, there is only what they can get away with.
Window tax? Existed up to 1851. Is it right that having more windows meant you should pay more tax?
Income tax? Why is that moral? You have earned the money, why should the government tax it?
Except - all tax is based around the movement of money or goods, i.e. somewhere where 'wealth' is demonstrable, and takes a percentage. This is true of income tax, IHT, CGT, council tax, etc, and is one of the reasons why poll tax was hated - it taxed existence whether or not there was any wealth.
Unless this fundamental is questioned, everything else is just arguing about where such 'wealth' should be taxed, and by how much.
IHT is one scenario where there is clearly a pool of 'wealth' being transferred, and so is ripe for a tax.
My argument would be far more fundamentally, how do we significantly reduce the overall governemnt expenditure, so that all tax, however it is raised, is reduced.
mutter, mutter, 'workhouse', mutter, mutter
But then, what is a fair or moral tax?
The government, and civil service, exist, and cost money. There are two sides to this; raising the money, and spending it. Generally, government finances are dictated by how much they want to spend, since they can pretty much rasie what they want. (40%+ of GDP?)
This money has to be raised from the general populace. There is nothing implicit or explicit in fairness, there is only what they can get away with.
Window tax? Existed up to 1851. Is it right that having more windows meant you should pay more tax?
Income tax? Why is that moral? You have earned the money, why should the government tax it?
Except - all tax is based around the movement of money or goods, i.e. somewhere where 'wealth' is demonstrable, and takes a percentage. This is true of income tax, IHT, CGT, council tax, etc, and is one of the reasons why poll tax was hated - it taxed existence whether or not there was any wealth.
Unless this fundamental is questioned, everything else is just arguing about where such 'wealth' should be taxed, and by how much.
IHT is one scenario where there is clearly a pool of 'wealth' being transferred, and so is ripe for a tax.
My argument would be far more fundamentally, how do we significantly reduce the overall governemnt expenditure, so that all tax, however it is raised, is reduced.
mutter, mutter, 'workhouse', mutter, mutter
bertie said:I think that is exactly what is happening, the ones with money are leaving, the ones without are replacing them. If the UK was a company I would be looking to get rid of my shares sooner rather than later.
The danger here is that if you don't let people be sucessful by imposing cripling tax regimes, they all bugger off to somewhere else, as many people including JSG have suggested they will do, and you're left with a country full of dead heads and drop outs.
Ivan
Plotloss said:And what would be the objective of the charity?
If your kids were to register a charity and then you gifted the estate to that charity would that be a way around it?
You can take 70% as costs legally with a registered charity so thats a saving of 10% which is better than nothing...
ATG said:
If your kids were to register a charity and then you gifted the estate to that charity would that be a way around it?
You can take 70% as costs legally with a registered charity so thats a saving of 10% which is better than nothing...
And what would be the objective of the charity?
Avoiding tax...
30% goes to whoever you fancy, 70% as costs.
Wacky Racer said:
You are only allowed to "gift" a maximum of 3,000 pounds in any one tax year, however this can be backdated one year, making in effect 6000 in the first instance......
See, i've never understood this rule. Does this only apply in the IHT situation or generally? Can someone explain?
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