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Comments

mark curtis

This tax was only introduced to break up the large estates owned by the aristocrasy & now people in some parts of the country are paying it on ex-council housing stock! Any secondary tax is inherently unfair & a discouragement to hard work & frugality. We should not be forgetting about the other side of the balance sheet & talking about how to reduce the size of Government. Most of the growth under Bair has been in sectors where the private sector could & would do a better job. So let's take the State out of our everyday lives.

Adam

Gildas - Laffer has not been proved right by Bush's tax cuts, as the US still has a massive fiscal deficit, and is still predicted to have a massive fiscal deficit. That the prediction isn't quite as enormous as it was 6 months ago is hardly cause for massive celebration.

Martin Thornhill

I am astonished and disappointed by the economic illiteracy inherent in some of the comments to this blog.

The most disturbing comments are those who consider the removal of a capital tax to be an impediment to social mobility. The emotive conclusion would appear to be that if we are all equally poor, then we should all be happy and productive. Er... proof, please?

The fact that we would all then be in a consumer-led, subsistence-based economy without any reliable base for future investments appears not to matter to such writers. Money clearly grows on trees, just like spaghetti.

Other writers don't seem capable of figuring out that inheritence tax is double-taxation. For clarity, IHT the taxation of accumulated wealth *after* tax was taken from its income, q.e.d. income is taxed twice: once at source; a second time much later on, i.e. at death. Who doesn't understand this?

Beyond economic illiteracy, other writers take the population for moronic fools ("we need to appeal to middle-ground voters"). OK, so the Conservatives are all about being as ignorant and innumerate as Joe Public? Excuse me, what would happen if our courts of law did that? Exactly. So why put up with this sort of "need to appeal" in an election? Labour does this already, we don't need another party doing it too.

Bottom-line: taxing capital sacrifices tomorrow's income, because government only ever wastes tax. No future growth can ever come from British public spending.

Scrap inheritance tax. And while we're at it, scrap capital gains tax as well. CGT has always costed more to administer than the receipts it collects.

Is this Conservativehome, or OldLabourHome?

Steve

Well said Martin. Three cheers!

Simon Perry

You think that inheritance tax is unfair? Of course it’s unfair – all tax is unfair; your money is being taken by force. But even if we reduce our government expenditure to the bare minimum: defence and police, we'd still need tax. The only choice really is how we pay it.

Given the choice, I would prefer to pay my taxes after I'm dead.

In almost every other form of tax, we are taxing the earned:- taxing the very thing that benefits our economy and keeps the quality of British life as high as it is. Surely it makes more sense to tax financial transactions that have no benefit to the UK as a whole.

The argument that inheritance tax is a second tax on the same money just doesn’t stand up. It’s true – but it’s also true for most tax. Income, inheritance, VAT and NI all tax the same money over and over as it moves from person to person. The only difference with inheritance tax is that the money wasn’t earned: the person receiving the money hasn’t needed to give anything in return.

Income tax is akin to slavery: the benefits of your labour are being taken by force. Tax on inheritance is akin to theft. Which is worse?

Deputy Editor

Radio 4 Talking Politics is currently looking at the arguments for abolishing IHT. They introduced it by talking about Built to Last and how it didn't specify which taxes were unfair.

They've interviewed a guy from the US about the debate over there - such as how they call it a death tax and how close they are to having enough elected supporters to cause a filibuster.

Now talking to Daniel Finkelstein and Alister Heath and John Rentoul.

You should be able to re-listen to this debate via the website.

Yet Another Anon

Stephen Byers as well has come around to believing it should be scrapped, but such proposals have been rubbished by the Treasury and by the dti.

It is probably as well to leave it in place until the public finances can be brought back into surplus and then scrap it, the focus at the moment should be on reducing Income Tax and Capital Gains Tax and Corporation Tax rates and raising the threshold for them and extending VAT, public spending should also be cut back but equally reducing PSBR and moving to a situation of repaying National Debt should be a major priority.

IHT doesn't raise much and increasingly is falling on Middle Income households rather than the Super Rich it was intended to fall on as many of the very rich can afford to pay accountants to deal with it, also money paid out from Estates is normally still subject to Income Tax anyway as indeed Stephen Byers pointed out.

Paul Charlson

I think this would be a popular policy with voters.
It is a nasty tax,people work all their lives to build up wealth. This is already taxed more than adequately. They die and then pay all over again.
It now affects many middle income families the sort that are swing voters.

It has to worth a punt and would top my list of cuts. The cost is no currently huge and the impact on voter behaviour potentially significant

However in the longer term this will be an increasing earner for the exchequer because of rising house prices and the switch to property ownership as a pension option

Paul Charlson

I did not answer the questions!
1.It is difficult to bring it into the "brand" if we cannot mention tax. This is silly of course tax is always on the agenda. My feeling is this should be our only suggested tax cut at the election and could be counterbalanced by showing where this revenue could be raised elsewhere.
2. I live in the North and we are not all paupers past Watford Gap! Let the Government say it, Yorkshire folk and indeed the Scots like to hold onto their money so it will be popular here too.
3. Good start!increase the threshold to £500K - you can then use the srguement that you are only clobbering the wealthy, that plays well.

Allen Keyte

IHT should be immediately abolished on the main residence. As a priority amongst others it should be considered for eventual abolition.
Council Tax should also be abolished and the funding recouped through increasing VAT - finish the job that Michael Heseltine started.

Jamie Wallis

Lifetime wills offers an online will creation service.

Matje

Forget about the tax and just abolish inheritance.

Why should your undeserving offspring get it anyway?

Leave it all to a charity of your choice.

page

With blogs like this around I don't even need website anymore. I can just visit here and see all the latest happenings in the world.

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