Is it too early to chat about billionaires hoarding land and avoiding paying inheritance tax?

[feellikeahugefailure]

I know it involves a death and that's very sad for the family, but irrespective of that I do think inherited unearned assets is huge reason for inequality. The UK ranks badly for equality.

I don't think the existence of your farm should be dependent on the goodwill /business sense /success of whatever random person inherits the freehold. I own the farm outright and it's up to me to look after it, the animals and the people who work for me. -not in that order!-

" But i cannot be convinced that the best solution is to leave the wealth concentrated in the hands of a very few families to pass on to their offspring. "
Celtic - so how much land would one family be allowed to own in your ideal world?

Suitable homes for all. Employee owned businesses. An absolute limit on inheritance would ensure that families could not continue to hold massive areas of land indefinitely. Perhaps if I ruled the world nobody would own land at all... How about you? Do you think the current system is the best we can do?

Celtic
What other ownership would you limit?
Bill Gates hasn't made his fortune from land
nor
Warren Buffett, the Rausings, Carlos Slim, Mark Zuckerberg to name just a few.

Would you ban them from owning the means of production their own companies?

I don't have a problem with families owning a lot of land. As has been said unthread, the vast majority of estates are run as businesses so the land will be farmed productively and looked after.
I do have a problem with blocks of flats being bought as an investment and left completely empty apart from a caretaker - which is happening all over London, and for all I know, in other cities. However, maybe you aren't so concerned about this as the blocks of flats are generally owned by overseas buyers not English landed families.

Sorry, my last post was to Celtic

I might tax it beyond their wish to keep so much... I would probably have an absolute limit on private wealth. But my idea of what I might do if i ruled the world, often discussed over a few glasses of wine, isn't really relevant to a thread about inherited wealth. I'm still open to arguments in favour of it but i haven't seen any, beyond that it might be inherited by a nice chap who runs the business and treats the staff well.

Sorry - I got distracted by the Olympics.
Anyway, Celtic, you say you would put an absolute limit on inheritance.
Would you limit just land ownership? Or works of art? What about a family with 3 children whose house had 12 bedrooms so far more than they need?
Can you be more specific about your limit on inheritance?

Crossed post.
Celtic - What you would do to limit private wealth is perfectly relevant to a thread on inherited wealth.

Of course that bothers me Dapple why would you think it wouldn't? I don't see as clear a distinction between the two though. How can you define a productive business? If it's one that makes money the business that owns the flats probably makes more... If it's a moral distinction that's far harder to police. I don't have the answer, just musing. What would you do about the flats? What about on inheritance?

I would probably forfeit all private estates on death beyond a token amount to allow sentimental jewellery etc to be passed on. People could earn their money and use it in life but wouldn't be able to pass on amounts that allow wealth to compound through the generations. Their children would still benefit from the privileges that come with well off parents and the money could be put towards improving opportunities for all How about you? Do you think the current system is the best we can do?

What I would like in the world as it is is for 40% IHT to be charged and paid on estates above the generous limit.

Removing inherited wealth from people, so it makes it not worth accumulating, you have a society where there is no inspiration to do anything. It stifles growth and entrepreneurship. It is close to Communism. Most people like the idea they can pass wealth to their children or other family members. Of course, the majority have wealth! Not everyone is penniless. IHT is levied when a person dies because they may not be able to pay the tax if they are asset rich but cash poor. Therefore the asset has to be sold. How could it work any other way?

Large landowners, such as Dukes, can do more good than harm . They employ people, they provide homes, they can set up charities and they are looking after our land and farms.

Plenty of ordinary people have done well for themselves. If everything gets handed to the state, what would be the point in trying to be a high achiever? What message does it give out to young people if everything you accumulate will be taxed to oblivion? The message would be to sell up and move to another country.

So you want a land grab like Zimbabwe? The Scottish govt is thinking of doing this isn't it? A sort of up to date ksnd clearance? A payback for the past? It is the politics of the envious. Who gains in the long run? Why is taking the land that belongs to others so important? It is nasty and snacks of a dictatorship - a Scottish one!

My objection to the flats is that there is a serious housing shortage in London. Leaving flats empty when they could be rented out and lived in seems to me worse than owning farmland and raising stock and growing crops and providing food.
If, as you say, you want to confiscate estates on the death of the owner then presumably you would also want to take all other businesses which are privately owned.
Do you think business owners will bother to work hard building up their businesses if they are not allowed to pass on any of their wealth?
Will you take all big houses into state ownership? How will their running costs be covered? By selling valuable paintings that come with the house?
If Jeremy Corbyn wins the next elections then your wishes will come true.

RIP Duke of Westminster.
He was respected and well liked.
www.grosvenorestate.com/duke-of-westminster.aspx

Celtic - sorry I didn't read your post properly.
You say "What I would like in the world as it is is for 40% IHT to be charged and paid on estates above the generous limit."
Yet you start off saying you would forfeit all private estates bar some jewellery.
You have contradicted yourself - having 40% death duties is quite different to taking everything bar some jewellery.

The top 1% of income earners contribute 30% of personal taxes to the Exhequer. Yes it reflects the income inequality in the UK but is no different to other countries. The those same people and the next 9% of income earners contribute more into the system than take out if it. Everyone else broadly takes out more than they put in. I have no problem with that and it's exactly what it should be in a fair society. That doesn't mean that I agree with it being taxed again at death.

also my earlier point was that it is always assumed that wealth has been accumulated through rising property values and that's just not always true. certainly not for any of the wealthy people I know.

Personally I have no problem with money or property being passed on. My issue is that it seems unfair that gifted sums should not be subject to any tax at all on the part of the recipient, whereas earned income (which somebody has worked for and which should be incentivised) is currently subject to tax at a marginal rate of up to 65%. We obviously need to generate income from taxes in this country, and I think there is a fairer tax system that involves at least some tax being paid on everything that is simply gifted or inherited, rather than almost everything falling on people of working age who actually put effort into their own wealth creation. We used to have a system of tax on capital transfers until Thatcher abolished it - this is not a new idea.

I also would not tax estates but individual recipients. If a person wants to keep their estate intact for the benefit of their tenants, they could leave it to a charity to do just that. Perhaps there could be a system whereby if 40% is given to charity, there is no tax to pay on the remainder. Lots of options, anyway, many of which I think are fairer than the current system.

I would also consider myself reasonably well-off, so hardly one of the have-nots feeling envious. It's lazy to assume that people who criticise the current system are all jealous and want to grab more for themselves.

My guess would be that celticpromise is lucky enough to have children who have a chance of being independent of her in adulthood. Those of us who do not share her good fortune often see the IHT issue very differently. I will use every legal means available to leave as much as I can to myDC, having genuine fears for what will happen to DS when I die. I make no apology for this.

I would probably forfeit all private estates on death beyond a token amount to allow sentimental jewellery etc to be passed on applied to everyone?

1. Where would the rest of the accumulated wealth go?
2. Where would the surviving spouse live? Or their kids?
3. How would you redistribute that wealth?
4. How much would that cost?
5. Why would people bother working?
6. No one would save, everyone would spend every penny they earned...

Or did you just mean Estates, the big ones? You would only take from the richest?

1. How rich?
2. I refer you back to socialist countries, past and present...

Karlos - most people now are lucky enough to be in their 50s or 60s when their parents die. Hopefully your son will be independent of you by then! Surely it makes more sense for him to have more in his pocket through a reduction in income tax during his working life than to be dependent on you and unable to buy a home until he is in his 60s..?

Ps and if the issue is that your DS is not able to live independently then personally I think that is an even stronger argument for the state to properly support disabled people to live with dignity and as independently as possible regardless of their parents' wealth. Though of course I also completely understand your personal perspective and it is of course natural and blameless for you to use all legal means possible to preserve your estate for him

It's weire how "envy" is all inspirational and brilliant for "entrepreneurship" if it's wealthy people envying each other and needing to own more and more of the world's wealth.

But as soon as one of the little people dares to complain about the woeful incentives created by massive wealth and power inequality, then envy is terrible and must be crushed out of the impertinent upstarts.

Donald Trump is what happens when you ignore the fact that humans demand fairness.

Brexit is what happens.

Bloody revolutions.

We are a social species.

Unfairness pisses us off.

Alloowing bandits and thieves to hold on to their wealth and power for generations without paying tax is obviously unjust.

There is enough wealth in this country for everyone to be comfortable. For no hungry children. For no NHS debt. For proper social security

Inst3ad we have a handful of families sitting on vast swathes of land and becoming enormously wealthy through rent extraction.

Which is not at all socially useful or an efficient use of resources.

But apparently it's fine for the English to steal land but not for the Scots to take it back.

My ds has autism. He is unlikely to be self supporting at any age.

Karlos - I apologise if I came across as insensitive. I didn't pick that up initially from your post.