Inheritance tax

[Undesired Walrus]

Is inheritance tax a fair tax (The fairest of them all?) and is there anyone here who thinks the state should take 100%?

Just venturing my head into what I imagine should become a lively (and hopefully respectful) debate, and stating my belief that in the same way someone on benefits should not be permitted to sit around, do nothing and leech off taxpayers money, nor should a family member be permitted to sit around, do nothing and leech off the wealth created by society.

 

[psionl0]

Absolutely not!

The very idea that someone has to pay a massive fine upon the death of his or her spouse or that dependents get kicked out of their home because they can't afford the death duties is totally heartless!

 

[Skepticemea]

Property that has been paid for by income that has been taxed already (potentially twice if paid for from savings) that is then taxed when received by the fortunate bereaved is rather unpalatable.

 

[McHrozni]

Is inheritance tax a fair tax (The fairest of them all?) and is there anyone here who thinks the state should take 100%?

Just venturing my head into what I imagine should become a lively (and hopefully respectful) debate, and stating my belief that in the same way someone on benefits should not be permitted to sit around, do nothing and leech off taxpayers money, nor should a family member be permitted to sit around, do nothing and leech off the wealth created by society.

There is no such thing as a fair tax, since all taxes are, to a certain extent, unfair.
100% inheritance tax is, mildly put, ludicrous.

McHrozni

 

[Guybrush Threepwood]

I have some sympathy for the idea of a 100% inheritance tax, but I think it's so contrary to most peoples beliefs that I can't see it ever being successfully implemented.

 

[MRC_Hans]

Is inheritance tax a fair tax (The fairest of them all?) and is there anyone here who thinks the state should take 100%?

Just venturing my head into what I imagine should become a lively (and hopefully respectful) debate, and stating my belief that in the same way someone on benefits should not be permitted to sit around, do nothing and leech off taxpayers money, nor should a family member be permitted to sit around, do nothing and leech off the wealth created by society.

Inheritance is, basically an income, so in principle it is as fair as income tax.

Of course, their must be some fairness in metering it. In Denmark (one of the heaviest taxed places in the world), it is heavily graduated, both on amount and on how near the kinship. Charity institutions are generally exempt form taxes, so you can will your fortune to charity if you have no heirs.

The whole idea of the thing, apart from creating revenue, of course, is to hinder the collection of family fortunes, and it has effectively broken the power of the old noble families over a few generations, all in the name of democracy.

Hans

 

[Darat]

Is inheritance tax a fair tax (The fairest of them all?) and is there anyone here who thinks the state should take 100%?

...snip...

It is only rational for there to be no inheritance, so I would have thought that a "100% tax" on any remaining assets would be a rational way to deal with the assets left someone dies.

 

[MRC_Hans]

There is no such thing as a fair tax, since all taxes are, to a certain extent, unfair.
100% inheritance tax is, mildly put, ludicrous.

McHrozni

If you want to live in a society, this society needs to create some income. Tax is very democratic, in principle.

I agree that 100% inheritance tax is absurd. Does it exist anywhere?

Hans

 

[Darat]

Absolutely not!

The very idea that someone has to pay a massive fine upon the death of his or her spouse or that dependents get kicked out of their home because they can't afford the death duties is totally heartless!

If it was their property prior to the death of the relative then there wouldn't be any question of kicking them out and if it wasn't their property what right do they have to it?

 

[MRC_Hans]

Property that has been paid for by income that has been taxed already (potentially twice if paid for from savings) that is then taxed when received by the fortunate bereaved is rather unpalatable.

Or you could view it as simple income. Otherwise you could also argue that your employer already paid tax, so why must you? Tax is paid every time money changes hands.

Hans

 

[MRC_Hans]

Absolutely not!

The very idea that someone has to pay a massive fine upon the death of his or her spouse or that dependents get kicked out of their home because they can't afford the death duties is totally heartless!

I don't think any countries have inheritance taxes from next of kin, anywhere that level. Even Denmark hasn't.

Hans

 

[Skepticemea]

Or you could view it as simple income. Otherwise you could also argue that your employer already paid tax, so why must you? Tax is paid every time money changes hands.

Hans

I could, but I wasn't. It's not money, it's a possession, albeit one with a monetary value, as do most possessions.

 

[richardm]

Property that has been paid for by income that has been taxed already (potentially twice if paid for from savings) that is then taxed when received by the fortunate bereaved is rather unpalatable.

Yes, this. To me, it is in effect a gift made after my death. I paid tax when I earned money to buy the gift, I paid tax when I bought the gift. Why on Earth should the recipient have to pay tax when I give it to them?

 

[Ziggurat]

Yes, this. To me, it is in effect a gift made after my death. I paid tax when I earned money to buy the gift, I paid tax when I bought the gift. Why on Earth should the recipient have to pay tax when I give it to them?

As a matter of fact, if you give a large enough gift to someone (other than your spouse) while you're alive, you DO need to pay taxes on that gift. So that argument doesn't work.

 

[Ziggurat]

I agree that 100% inheritance tax is absurd.

Quite so. It won't even do much to raise revenue, since people will just work to make sure they spend out their estate by their death.

 

[Skepticemea]

As a matter of fact, if you give a large enough gift to someone (other than your spouse) while you're alive, you DO need to pay taxes on that gift. So that argument doesn't work.

That "argument" is actually an opinion. I don't like Vegemite, but I don't deny its existence.

 

[richardm]

As a matter of fact, if you give a large enough gift to someone (other than your spouse) while you're alive, you DO need to pay taxes on that gift. So that argument doesn't work.

I'm not American, so your link doesn't apply, but even if it did it wouldn't change my opinion that it's wrong that the recipient should be expected to pay tax on a gift.

 

[Ziggurat]

That "argument" is actually an opinion.

No, it was more than that. Not liking the estate tax is an opinion. Not liking the gift tax is an opinion. Thinking that we shouldn't have to pay an estate tax because inheritance is just like a gift is more than opinion, it's an argument against the estate tax based on the premise that we shouldn't treat essentially equivalent acts in fundamentally differently ways. If you accept the premise, then certain conclusions follow about estate and gift taxation which are independent of your opinions about them in and of themselves. I think that premise is held by plenty of people who don't specifically oppose estate taxation, which is why it's significant as an argument and not simply a statement of opinion.

But we DO have a gift tax. And as far as I can tell, most countries with an estate tax also have a gift tax. Here's some info from Europe. Only 2 countries out of the 29 listed (Malta and Romania) have an inheritance tax but no gift tax. 6 of the 29 have neither an estate or gift tax, and 22 have both (none have a gift tax and no estate tax). So the argument is not invalid, but rather seems to have been largely accepted implicitly already: very few countries don't treat these essentially equivalent activities (gifts before and after death) in fundamentally different ways.

 

[richardm]

No, it was more than that. Not liking the estate tax is an opinion. Not liking the gift tax is an opinion. Thinking that we shouldn't have to pay an estate tax because inheritance is just like a gift is more than opinion, it's an argument against the estate tax based on the premise that we shouldn't treat essentially equivalent acts in fundamentally differently ways. If you accept the premise, then certain conclusions follow about estate and gift taxation which are independent of your opinions about them in and of themselves. I think that premise is held by plenty of people who don't specifically oppose estate taxation, which is why it's significant as an argument and not simply a statement of opinion.

I think you're missing my point entirely.

Edit: You appear to be entirely hung up on the word "gift" because the USA has some tax called "Gift Tax", whereas I'm thinking more along the lines of your children having to pay a tax demand based on the box of Lego you gave them for Christmas.

 

[Humes fork]

We don't have any inheritance tax and go along just fine. I'm unsure if there should be one or not, but as it is clearly not a critical issue, I don't think it's very important. The idea of a 100% inheritance tax is ridiculous.