Death Taxes

[Nostromo]

Originally posted by Odin
The proper term is "Estate Tax." "Death Tax" is a right-wing frame, kind of like "pro-life."

IMO people should be allowed to inherit no more than $1 million. An aristocracy of those who inherited ungodly amounts of wealth is indefensible, immoral, and contrary to democratic and meritocratic principles.

You're evil, too.

Seems perfectly defensible and moral to me.

[aneeshm]

A state that profits from the death of its citizens, in the name of some "egalitarian" idea, completely divorced from reality, and in complete defiance of the sanctity of property rights, is a moral abomination.

[Odin]

Originally posted by aneeshm
A state that profits from the death of its citizens, in the name of some "egalitarian" idea, completely divorced from reality, and in complete defiance of the sanctity of property rights, is a moral abomination.

There is no such thing as the "sanctity" of property rights. the need to prevent a society descending into oligarchy trumps property rights. If an illiberal plutocratic oligarchy takes power you'll have a lot more rights to worry about losing.

[Imran Siddiqui]

Originally posted by lord of the mark
But why shouldnt we double tax inheritances? Inheritance represents a source of social power, that reduces mobility in society. If the people decide that thats a bad thing, (and I tend to think it is) they can of course tax it.

The main reason to not excessively tax income is to avoid creating a disincentive to earning it. Will taxing its passing via estates have the same impact on earning activities? Maybe it will, maybe it wont. Thats an empirical question, and if one believes it wont, it could make a lot of sense to tax inheritance.

Exactly. Society has put institutions in place that allow those people to earn all of their money and keep all of that money safely. So why should society not have the right to decide what to do with it when you pass on?

If we are talking about incentives (which I think should be considered), really a "Death tax" isn't going to provide a disincentive for people to earn money. It'll provide an incentive to sneakily transfer money or to give to charity. Sure plenty will be sneakily transfered, but I'm sure a good portion will go to charity... which is good, I'd think.

[aneeshm]

It amazes me how some people think that they are the only ones in possession of some elite knowledge, and have the right, nay, the duty, to ram their vision down the throats of others, by force if necessary. The assumption underlying this is, of course, that they know better than everyone else, and that everyone else's opinions or even rights don't count as much as their vision does, consequences be damned.

[Imran Siddiqui]

Originally posted by aneeshm
It amazes me how some people think that they are the only ones in possession of some elite knowledge, and have the right, nay, the duty, to ram their vision down the throats of others, by force if necessary. The assumption underlying this is, of course, that they know better than everyone else, and that everyone else's opinions or even rights don't count as much as their vision does, consequences be damned.

Yes, I do hate it when aneeshm does that!

[Whoha]

Originally posted by Odin


There is no such thing as the "sanctity" of property rights. the need to prevent a society descending into oligarchy trumps property rights. If an illiberal plutocratic oligarchy takes power you'll have a lot more rights to worry about losing.

If it happens it won't be because we didn't tax the super rich enough, it will happen because people let it happen.

[Rufus T. Firefly]

Just curious -- I have no dog in this hunt -- isn't paying sales tax on items purchased with my taxed income also double taxation? If so, why is that no problem, but an inheritance tax is?

[Dauphin]

Originally posted by Whoha


So what are they doing? giving money to a family member of the intended recipient, having that person change his will, and then offing him?

Scenario 1:
Suppose you earn all your money first and blow a massive amount of it on booze and women, and then you waste the rest. You have no money. You inherit a load later in life and spend hardly any of it.

Scenario 2:
You inherit a load of money which you blow on booze and women, and you waste the rest. You have no money. You then get your act together and work hard the rest of your life to earn a sizeable estate before you die, but you spend hardly any of it.

It is clear what has been spent in each case. Scenario 1 death estate is inheritance, scenario 2 death estate is earnings. In one scenario you would expect massive taxation because it is inheritance, the other you would expect no taxation as it is earnings.

Add to all that, that the likelihood of you keeping records of how much money you earnt and how much you inherited your entire life are slim, you will find it very hard to assess.



And I haven't, 'til now, even raised the paradoxical situation of having an inheritance tax system that only taxes money that was passed on as an inheritance because there is no inheritance tax to tax that money in the first place.

[Dauphin]

Originally posted by snoopy369
Inheritance taxes are one of the few things i'm quite left of center on. I believe that inheritance should be highly taxed, above a certain level; think 75% to 90% over $1m.

Why? Because I think that this would improve the economy (encourage spending rather than saving late in life, as compared to early in life; increase spending in the economy, improving business). Because I think that the greatest threat to the Liberal (big L) way of life is an aristocracy, and our current inheritance tax laws encourage aristocracy (by encouraging the accumulation of wealth, and guaranteeing that the number of people holding the nation's wealth will continuously decrease). Because I think that getting rid of the morons who control way too much money without working a day in their lives and without having an ounce of brains in their head in any other way would probably be considered illegal.

I'm well aware that, unfortunately, certain people (well, everyone) would immediately take their money offshore. Fortunately, I have a solution to that too 90% (or some number higher than the inheritance tax) tax on money over $1m (per decade) entering the USA from overseas and not exchanged for goods directly. Might play havoc on the stock market, but at this point it wouldn't matter much anyway, right?

(Yes, I'm aware that both of these are fairly impractical to bordering on maniacal; but what's the point of talking about things if you don't go to the extreme, right? )

Trust funds will love you.

[East Street Trader]

Inheritance tax has worked a considerable change in the UK over my time.

Up until the Second World War wealthy families tended to be able to keep their wealth decently intact from generation to generation. Sixty per cent of the working population worked in personal service to the rich.

Inheritance tax has changed that. Each death eroded the wealth, on top of which it stopped being sensible to concentrate inheritance primarily into the hands of one person in each generation.

Landed estates have substantially been broken up and ownership of the land is now much more in the hands of working farmers.

In general I would say this has been healthy.

Currently inheritance tax is very unpopular - because each year house prices have risen far faster than the rate at which the lowest level for inheritance tax has been raised. With the substantial expansion in the number of people who own their own home which has taken place since the war a much greater proportion of people reach the end of their life with the knowledge that their estate is going to pay a hefty chunk of inheritance tax.

I predict that one of our political parties will get around to adopting a policy of either doing away with the tax altogether or else doubling and tripling the lowest level at which it bites. So that, once more, it is only the estates of the wealthy which pay anything.

In the most general of ways, I am against the accumulation of great wealth. So I guess I support an inheritance tax. But perhaps it should be focused on a somewhat narrower group than it currently is in the UK.

[PLATO]

Exempt the 1st $75,000/ year in income. Tax all amounts above that at whatever rate is needed to fund the current budget. Remove all other taxes and any deductions.

The death tax is absurd. If I decided to take my "fortune" to Vegas and blow it on the craps table then there is no "transfer" tax, but let me leave it to my children and hold on! Uncle Sam has to get his! Ridiculous.

[Patroklos]

So that, once more, it is only the estates of the wealthy which pay anything.

Yes, but justify that morally or legally. Basically it comes down to simple jealousy.

What right does the state have to disproportionaly tax the wealthy?

[Imran Siddiqui]

Originally posted by PLATO
The death tax is absurd. If I decided to take my "fortune" to Vegas and blow it on the craps table then there is no "transfer" tax, but let me leave it to my children and hold on! Uncle Sam has to get his! Ridiculous.

Well, blowing the fortune in Vegas probably has a more positive effect on the economy than leaving it to your children . I'm sure those casinos are better in investing that money .

[Imran Siddiqui]

Originally posted by Patroklos
What right does the state have to disproportionaly tax the wealthy?

The fact that the infrastructure of society has allowed the rich to accumulate and keep their wealth. We, could, after all, just leave them to their own devices and not give them police protection and have them pay for their own roads to send goods to people (ie, an anarcho-capitalist state). But that wouldn't really work out so well... and probably would lead to some sort of socialist revolution where the rich would be hanging from lampposts and their riches "distributed", as it were. So the rich don't complain all that much.