Abandon All Fear

What nobody else seems to be saying…

Equal Inheritance

Posted by Lex Fear on August 19, 2007

If inheritance tax was abolished, what would stop us going back 150 years to the times where families acquired huge amounts of property and wealth, whereas those without simply became servants to those fortunate enough to inherit?

I don’t like tax, I hate the way that the government uses tax as a big fix-all to every socio-politico-environmento-economic problem, however it appears to me that some tax is necessary to keep a fair and equal balance in society.

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5 Responses to “Equal Inheritance”

  1. mattghg said

    Hi Alex,

    Like the look of the new blog!

    I agree that tax is necessary to keep people afloat and so the government can spend money on stuff that it needs to. The thing is the system is just so complicated that you can’t help feel that some people are falling through the gaps and being treated unfairly. Maybe they just think inheritance tax is one of those situations.

    mattghg

  2. True, it’s complicated, like the whole tax system.

    I find the governments system of taxation to be pretty much morally questionable- when they can’t even work out the correct amounts of entitlement themselves- I am still paying back overpaid tax credits from over a year ago.

    However, when it comes to inheritance, such as property, the property can be sold to meet tax requirements, unlike say, council tax, where people must meet that through other forms of income.

    I must say I’d be in favour of abolishing inheritance tax if they stuck a tax on second homes.

  3. Stef said

    Nice idea in theory but our tax and wider economic system is actually structured to prevent people of modest means accumulating capital, whilst allowing the very rich to increase their fortunes. It’s there to widen the inequalities not to level them out

    Would you like an example? Try this for starters…

    http://tinyurl.com/3284u7

    Forget about people falling through the gaps, if you’re rich enough you get to dictate your own terms completely divorced from the legislation that applies to us peons

    Think about this also, once the government claws back the bulk of the money homeowners have made on inflated property prices through the tax system, very few few people in the generation that follows them will have access to large chunks of capital. This means that virtually everyone will have to take out near 100% mortgages and service the interest on those inflated house prices

    Nice for the banks not so nice for people who will become their serfs for most, if not all, of their lives

    There’s a strong case to be made for wealth redistribution in modern society but take a look around and you’ll see that what is actually taking place is wealth concentration. That will be a whole lot clearer when the debt bubble finally pops

  4. Sadly it seems it will always be the case, which is why the rich get richer and the poor get poorer. The rich are rich because they find new ways to earn money- they find opportunities.

    I believe we’re already seeing your prophesy coming upon us without government intervention. Aren’t people taking out 100% mortgages now (like lambs to the slaughter)?

    One of the great problems I see with property is there is very little regulation over the market, even less accountability, property is seen as an asset rather than a living necessecity, yet there is a lot of regulation to govern who can build and where.

    Property has to be one of the areas government should intervene. I distrust government on a lot of things, but I distrust banks and estate agents more. Look at all the abandoned properties around London for a start (just take a drive down Hangar Lane off the A40)- I’d love to see a law introduced that says if a property or land has not been developed/renovated after 6 months that the government could sieze it and sell it at auction.

    That would stop all these greedy investors who simply hang on for prices to rise, it would free up hundreds if not thousands of homes for people to easily afford.

    I don’t know, I’m kind of socialist leaning on this one. Of course we plan to buy at some point and when we move to Canada we’ll probably rent rather than sell, which could make me sound like a hypocrite, but there is a market for rental housing and market forces should determine the rate that BTL’ers rent at.

  5. stef said

    The BtL’ers I know who entered the market in the last few years are looking to make money on the capital appreciation of their property and are effectively subsidising their tenants who are paying nowhere near the what the properties would cost them on a 100% mortage.

    The BtLers are also, unlike their tenants, bearing the risk of the property dropping in price and interest rates rising

    A lot of those greedy investors are about to get creamed

    Don’t get me wrong, speculative BtL sucks arse but OTOH what alternatives are there for people looking to put a pension together. Inflation and taxation make a nonsense of saving money in a bank account and the stock market is a rigged theft-machine

    Re. people servicing 100% mortgages – yup, there are plenty of people already doing that but the point I’m trying to make is that the tax system is rigged so that in a generation or so virtually *everyone* will be in that boat – and how would you describe a system that has people paying a third or a half of their net income (as rent or interest) to a corporation (private or public) for their entire life? It sounds like serfdom to me

    And like I said, a strong case can be made for at least some wealth distribution in a modern, compassionate society – the only problem is that it never works that way. All you have to do is take a look around UK society today. The tax burden (obvious and hidden) has risen remorselessly and some redistribution has supposedly taken place – so how is it that, by any measure, inequality has risen in an almost Victorian way.

    Like I said before, once the debt bubble is demolished what has been going on will be a *lot* more obvious

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