100% inheritance tax?

[Kendodd]

Or 95%, something like that.
Thought experiment.
How would it pan out?

Lender = landed.

Op, quite a few posters have asked that since you disapprove of inherited wealth, if you’re going to give your inheritance away?
Are you going to?

I have no problem with IHT but I think a better option would be to overhaul the tax system so that wealth is taxed. Assets in trusts and increases in property values in particular.

Yep. Or ask the person passing it on to give it away

Mind you if they get the same impression irl or see this thread and hear they haven’t worked hard maybe they’ll hand it to the dogs home anyway…

What people always forget in all this is how much more could be provided for everyone if society as a whole, via government, had access to all the funds currently tied up in unearned wealth such as inheritance.

This post exactly illustrates the problem. We have a society in which the major faultline between economic classes, and the major determinant in whether you stand a chance of a decent life, is whether you own property or not. And with ridiculous house prices and the selling off of council stock, the major determinant behind that is the wealth of your parents, either through supplying a deposit while they're alive or bequeathing one when they die.

If we actually did something about reversing the obscene level of inherited property acquisition in the UK, where less than 1% of the population own half of the country's land, we could change that. There's no reason we couldn't have a country where everyone who's willing to work a decent amount can have the security of their own home, regardless of their background, and situations like yours don't arise. But because we don't have the political will or ideological imagination to do so, everybody has to panic and hold on tightly to their own chance of falling on the right side of the faultline, perpetuating the problem.

Totally agree. It makes no sense when people who supposedly support low tax regimes to respect the value of work and personal enterprise, then support taking higher levels of tax from work (via income tax) than they do from the-money-you-get-for-doing-absolutely-fuck-all (via IHT, CGT etc). It's logically insupportible.

This is an interesting point. Why would the country be on its uppers, just because people are no longer hoarding vast amounts of wealth?

Most economic theory (and I'm not talking Marx, but generally respected mainstream capitalist theory) says the opposite: that converting saved wealth to spending stimulates economic growth.

That being precisely the problem.

No, taxman would get more because every time you "fritter it all away" on something they would get VAT. And then income tax (or corporation tax, or whatever) from the recipient of your frittering. Taxman will always get more from people spending money than saving it.

OP is there anything else of mine you'd like to take off me and redistribute how you see fit?

Maybe my car? Know someone more deserving of my kidneys?

I'll give my belongings to who I see fit, thanks anyway.

No one would bother to save anything at all would they? If I had any spare I'd spend the lot if I thought the government were going to get it-and I say that as someone who works in social care and can recognise the need. 40% is fair I think-it's still a huge chunk. Anything else just disincentives any sort of work or savings really.

Great recipe for capital flight there, along all with lower classes asset stripping themselves before death.

OP I'm not clear from some of your comments, but do you realise that inheritance tax is already at 40% for everything over £325k? This does not apply if everything goes to a surviving spouse.
I think paying some inheritance tax is fair, but I strongly disagree with an attitude that implies everything I own belongs to the state except the bit they kindly allow me to keep.

Has any young person ever chosen to not buy a house because they'll only have to sell it to pay care home fees when they're 80.

But there’s a very good chance they won’t have to sell it to pay care home fees when they get to 80. Not one single person in my family so far has needed a residential care home. Whereas death and taxes are a guaranteed certainty so it’s different.

Obviously, those of us that are hoping to leave something to our children are hoping that we won’t need to spend it all on care home fees. If we do, then the kids won’t get it, but at least we know there’s a high chance they will.

Honest answer, I don't know.
I'd probably give it to my children (or given the age people inherit, grandchildren) as this might be their best chance of buy a house. I resent this. I don't like the fact that we live in such an unfair society, that your best chance of buying a house is down to whether you have rich relatives or not. I would rather my children (anyone's children) could stand on their own two feet as young adults and provide for themselves. As I said earlier, our labour (that almost any young or working age person has an opportunity to do) is worth two little and assets (concentrated in the hands of the few and very difficult to acquire) are worth two much. I think labour/assets being so out of balance harms all of us (or well, 99%).

Fuck that

I already pay high tax. I want DC to be provided for when I'm gone. I work hard

Just wanted to say, eight years of care home fees will easily put paid to any notion of a huge payout.

I wouldn’t agree with such a model. For a start there would need to be so many exemptions eg children under 18, spouse etc. I do think though that stamp duty should be charged when a property is sold and not be payable by the buyer. There have been lots of people who have made a lot from property growth through luck. That change would arguably hit inheritances through an indirect means when a property was sold.

KenDodd this post is obviously a wind-up.
You say you think there should be 95% inheritance tax and then you say you’re going to leave your property & money to your children.
It reminds me of the once prolific poster Bertrandrussell - though I haven’t seen her around for ages - who used to bang on about the iniquity of grammar schools despite the fact her dc attended one.

People think of inheritance being a nice extra for adults.

They don’t think about those who die leaving behind babies and children.

Nor do they think about the nature of property, and whether it is owned or just rented from the state.

I agree with you OP and think you have some very valid points.

Inheritance entrenches inequality. Assets are worth far too much. Labour is worth too little. It is not fair. I think it should be highly taxed on a sliding scale. Society would be far better off, and more equal. I say this as someone who will likely have a large inheritance one day.

I am interested to see that a lot of people on this thread are wanting IHT increased because the recipients haven’t done anything to ‘deserve’ the unearned income they receive. But conversely they want the money to go to the government who can then redistribute it to another set of people who apparently do ‘deserve’ to have unearned income. Not sure how that works.

This does not apply if everything goes to a surviving spouse.

I'm sure some people would like to stop that as well!

I say this as someone who will likely have a large inheritance one day

mjf981 so will you give away your inheritance since you disapprove of inherited wealth, or will you be a hypocrite like Kendodd and leave it to your children?

Indeed. There is no meaningful widow’s pension these days. Windows get no additional benefits or tax allowances. Regardless of what the dead parent has paid in, or taken out, you get about 7 grand over the 18 months after they died. That’s it, to replace their lifetime income. If my inheritance had been taxed more than it was, I’d be pretty bloody penniless (I mean, I am penniless. But I have assets to fix it with). You can’t have it both ways, and they’ve already removed the giving part so they can jog on with the taking away!