Income v Inheritance taxes.

[Fittster]

The country is broke and the government of whatever colour is going to need to raise taxes (no way are they going to slash services to the degree needed to get the budget under control).

So Labour are hitting fuel and introducing a 50% band, which isn't predicted to raise more than a couple of billion.

Now personally I don't like paying tax but if I must I'd rather pay it when I'm dead.

"In the latest year for which we have data, £58.3bn (pdf) was inherited. The tax rate on this was a mere 5.8%. Why should inheritances be taxed more lightly than work or savings?"
source

I have to say that seem to make sense to me. So rather than raising income tax why not go for Inheritance tax? Everyone starts the same and the successful can enjoy their bounty without giving half to the government. Hard workers are rewarded more, while the lazy who are waiting to get get other people's wealth lose.

Maybe it's because I'm not a parent that I don't give a stuff about passing anything on to future generations (although passing on a huge government debt burden is unfair).

[Martial Arts Man]

Fittster said:

The country is broke and the government of whatever colour is going to need to raise taxes (no way are they going to slash services to the degree needed to get the budget under control).

So Labour are hitting fuel and introducing a 50% band, which isn't predicted to raise more than a couple of billion.

Now personally I don't like paying tax but if I must I'd rather pay it when I'm dead.

"In the latest year for which we have data, £58.3bn (pdf) was inherited. The tax rate on this was a mere 5.8%. Why should inheritances be taxed more lightly than work or savings?"
source

I have to say that seem to make sense to me. So rather than raising income tax why not go for Inheritance tax? Everyone starts the same and the successful can enjoy their bounty without giving half to the government. Hard workers are rewarded more, while the lazy who are waiting to get get other people's wealth lose.

Maybe it's because I'm not a parent that I don't give a stuff about passing anything on to future generations (although passing on a huge government debt burden is unfair).

This sounds like Old Labour's unearned income tax of the past.

Didn't work then, wouldn't work now.

[elster]

So you think money earned should be taxed twice?

Why not just up income tax to 75%?

[Legend83]

elster said:

So you think money earned should be taxed twice?

Why not just up income tax to 75%?

Because no-one wants to receive the minority share of their pay. If I was taxed 75% I would not be arsed to work hard.

[Spiritual_Beggar]

As a short term solution maybe;


But why the hell is there even an inheritence tax!! It's the most immoral of all our taxes!! The government have absolutely no right to that money what-so-ever!!! That money is already taxed when earnt as income. So why should the government get any of your money when you die.

I wouldnt agree to this proposal purely based on my belief that there should be no inheritence tax!

But, as a short term solution, and a way of raising capital for the country during this period, then it would make sense.......but of course....the Government doesn't operate based on sense!

[Martial Arts Man]

Spiritual_Beggar said:

As a short term solution maybe;


But why the hell is there even an inheritence tax!! It's the most immoral of all our taxes!! The government have absolutely no right to that money what-so-ever!!! That money is already taxed when earnt as income. So why should the government get any of your money when you die.

I wouldnt agree to this proposal purely based on my belief that there should be no inheritence tax!

But, as a short term solution, and a way of raising capital for the country during this period, then it would make sense.......but of course....the Government doesn't operate based on sense!

Is it even plausible/implementable? Short or long term?

I say nay!

[Fittster]

elster said:

So you think money earned should be taxed twice?

Why not just up income tax to 75%?

I think the overall tax burden is going to rise. I'd rather it was added to Inheritance tax than income tax. So leave or cut income and add it on to inheritance. If taxes must rise (and both main parties are saying that) why not increase inheritance taxes?

The conservatives are pleding to raise the inheritance tax threshold to £1 million pounds while raising income taxes. Seems odd to be that you are cutting one tax, while raising many others.

[Martial Arts Man]

The laws would have to be very draconian. Otherwise, anyone old or knowingly near death would simply sell everything, pay CGT and swan off to another, less tax hostile country.

It would also spell the end of foreign enterprise and investment in the UK.


One has to be very careful with these type of plans; they can very easily result in a talent/wealth flight.

[Fittster]

Spiritual_Beggar said:

That money is already taxed when earnt as income.

You could make the same argument for consumption taxes. I've been taxed when I earned it, now I'm taxed when I spend it.

The fact of the matter is you are going to pay a lot of taxes, so the question is where are they going to come from. More on fuel, income taxes, etc.

[Fittster]

Martial Arts Man said:

The laws would have to be very draconian. Otherwise, anyone old or knowingly near death would simply sell everything, pay CGT and swan off to another, less tax hostile country.

It would also spell the end of foreign enterprise and investment in the UK.


One has to be very careful with these type of plans; they can very easily result in a talent/wealth flight.

But if income and consumption taxes are raised instead why will people be in the UK in the first place? People are already talking about a talent/wealth flight in regards to the 50% tax band.

To my mind it's not if I'm taxed but when and rather than pay tax now I'd rather put as much of it off until I'm dead.

[Martial Arts Man]

Fittster said:

Martial Arts Man said:

The laws would have to be very draconian. Otherwise, anyone old or knowingly near death would simply sell everything, pay CGT and swan off to another, less tax hostile country.

It would also spell the end of foreign enterprise and investment in the UK.


One has to be very careful with these type of plans; they can very easily result in a talent/wealth flight.

But if income and consumption taxes are raised instead why will people be in the UK in the first place? People are already talking about a talent/wealth flight in regards to the 50% tax band.

Retired folk who pay no/little income tax?

I'd rather encourage them to spend all their money themselves than let the gov't hold the reins!

[Fittster]

Martial Arts Man said:

Fittster said:

Martial Arts Man said:

The laws would have to be very draconian. Otherwise, anyone old or knowingly near death would simply sell everything, pay CGT and swan off to another, less tax hostile country.

It would also spell the end of foreign enterprise and investment in the UK.


One has to be very careful with these type of plans; they can very easily result in a talent/wealth flight.

But if income and consumption taxes are raised instead why will people be in the UK in the first place? People are already talking about a talent/wealth flight in regards to the 50% tax band.

Retired folk who pay no/little income tax?

I'd rather encourage them to spend all their money themselves than let the gov't hold the reins!

Have you ever tried to get an old person to spend money? Maybe if they thought the government was going to take the lot they wouldn't be so careful.

[Martial Arts Man]

Fittster said:

Martial Arts Man said:

Fittster said:

Martial Arts Man said:

The laws would have to be very draconian. Otherwise, anyone old or knowingly near death would simply sell everything, pay CGT and swan off to another, less tax hostile country.

It would also spell the end of foreign enterprise and investment in the UK.


One has to be very careful with these type of plans; they can very easily result in a talent/wealth flight.

But if income and consumption taxes are raised instead why will people be in the UK in the first place? People are already talking about a talent/wealth flight in regards to the 50% tax band.

Retired folk who pay no/little income tax?

I'd rather encourage them to spend all their money themselves than let the gov't hold the reins!

Have you ever tried to get an old person to spend money? Maybe if they thought the government was going to take the lot they wouldn't be so careful.

I didn't really mean it to be honest.

I don't really subscribe to forcing people to spend their money, by whatever means.

Have you considered how your Original Post's topic could be implemented?

[Spiritual_Beggar]

Fittster said:

Spiritual_Beggar said:

That money is already taxed when earnt as income.

You could make the same argument for consumption taxes. I've been taxed when I earned it, now I'm taxed when I spend it.

The fact of the matter is you are going to pay a lot of taxes, so the question is where are they going to come from. More on fuel, income taxes, etc.

I understand that.

But you can see the sense and morality in those two examples. You could say that the Gov provided the land/ materials for the means to make your living; hence an tax. At the same time you can say, well the Gov provides the land materials for me to buy stuff; so you can see the point in a consuption tax.

I cannot see the point/ morality to inheritence tax though! Just becuase it exists...doesnt make it right!!!! They wouldn't need inheritence tax if they managed the economy better. Other countries seem to manage without an inheritence tax! It's not like our economy has benfitted from having it!

[Trommel]

Inheritance tax is immoral.

My money, I've already paid tax on it. I should be free to do with it as I wish.

[Fittster]

Martial Arts Man said:

Fittster said:

Martial Arts Man said:

Fittster said:

Martial Arts Man said:

The laws would have to be very draconian. Otherwise, anyone old or knowingly near death would simply sell everything, pay CGT and swan off to another, less tax hostile country.

It would also spell the end of foreign enterprise and investment in the UK.


One has to be very careful with these type of plans; they can very easily result in a talent/wealth flight.

But if income and consumption taxes are raised instead why will people be in the UK in the first place? People are already talking about a talent/wealth flight in regards to the 50% tax band.

Retired folk who pay no/little income tax?

I'd rather encourage them to spend all their money themselves than let the gov't hold the reins!

Have you ever tried to get an old person to spend money? Maybe if they thought the government was going to take the lot they wouldn't be so careful.

I didn't really mean it to be honest.

I don't really subscribe to forcing people to spend their money, by whatever means.

Have you considered how your Original Post's topic could be implemented?

There are already rules about giving away an estate to avoid inheritance taxes. As always some people will avoid them but some people avoid any tax you care to name.

However it would be possible to raise more through inheritance tax if the government of the day wished. Currently the conservatives are talking about leaving the 50% income tax rate in place while upping the inheritance tax threshold to £1 million pounds.

Workers and entrepreneurs will be impacted by the income taxes rises and may then leave the UK economy. These are the wealth creators who help grow the economy which will all enjoy.

Inheritance tax is paid by the dead, they no longer create wealth.

[Fittster]

Trommel said:

Inheritance tax is immoral.

My money, I've already paid tax on it. I should be free to do with it as I wish.

Same argument applies to consumption taxes and taxes on savings. So would you see all taxes but income tax abolished? If so can you imagine just how high a rate it would have to be.

[Fittster]

Spiritual_Beggar said:

Fittster said:

Spiritual_Beggar said:

That money is already taxed when earnt as income.

You could make the same argument for consumption taxes. I've been taxed when I earned it, now I'm taxed when I spend it.

The fact of the matter is you are going to pay a lot of taxes, so the question is where are they going to come from. More on fuel, income taxes, etc.

I understand that.

But you can see the sense and morality in those two examples. You could say that the Gov provided the land/ materials for the means to make your living; hence an tax. At the same time you can say, well the Gov provides the land materials for me to buy stuff; so you can see the point in a consuption tax.

I cannot see the point/ morality to inheritence tax though! Just becuase it exists...doesnt make it right!!!! They wouldn't need inheritence tax if they managed the economy better. Other countries seem to manage without an inheritence tax! It's not like our economy has benfitted from having it!

Which countries don't have inheritence tax?

To abolish any taxes you are going to have to make some pretty huge cuts in public spending. Raise a thread about slashing the NHS budget or doing away with the welfare state and see how much support you get. People expect the state to look after them from the cradle to the grave and that is expensive.

[Iain328]

Fittster said:

There are already rules about giving away an estate to avoid inheritance taxes. As always some people will avoid them but some people avoid any tax you care to name.

However it would be possible to raise more through inheritance tax if the government of the day wished. Currently the conservatives are talking about leaving the 50% income tax rate in place while upping the inheritance tax threshold to £1 million pounds.

Workers and entrepreneurs will be impacted by the income taxes rises and may then leave the UK economy. These are the wealth creators who help grow the economy which will all enjoy.

Inheritance tax is paid by the dead, they no longer create wealth.

One of the reasons "workers and entrepreneurs" keep going long after they have enough for their own needs is precisely so they can help secure the futures of their families.....

[Trommel]

Fittster said:

Same argument applies to consumption taxes and taxes on savings. So would you see all taxes but income tax abolished? If so can you imagine just how high a rate it would have to be.

I do not like state interference. Taxes do not need to be high - look at Singapore's expenditure on health care compared to the UK's, for example.

I prefer to choose what I do with my money, not to watch others live a (very comfortable) state-funded life on it.