It is very good example of political framing. It evokes the thought of tax as a punishment for dying, and its collection as a kind of harassment of the bereaved. So tax bad, case closed, no discussion.
But of course, it is not death and loss that it taxed, it is rather the accumulated wealth being redistributed over both society at large and the heirs, in some kind of ratio. In favor of inheritance tax: the wealth somebody amassed has also been thanks to its participation in society, so it is only fair some portion of it goes back to society. The heirs played no part in it, so why should they get any, let alone all of it? Furthermore, inheriting wealth goes against the idea of meritocracy, and maintains inequality in an unfair way in modern societies. Why should inheritance tax not be 100%?
Children often grow attached to the 'stuff' their parents have collected, be it things or land, houses or money. It seems unfair to take it all away from them, as they feel they already 'own it' merely by being their children. So inheritance tax is some kind of compromise.
However, as each generation these days tend to fully 'break' with their parents, in a way (economically, spiritually), inheritance itself seems more and more like a thing of our tribal pasts. I imagine a future where there is no inheritance tax anymore, because the whole concept of inheritance will go away.
Are you actually advocating for an inheritance tax close to 100%?
Because that is completely unworkable IMO, for several reasons:
1) Unless you introduce comparable "wealth transfer"/gift taxes, it becomes completely meaningless for the average case.
2) This would be insanely harmful in cases of unexpected deaths; inheritance is a really bad compensation already when someone close dies, this would make it even worse. And dealing with any kind of shared assets would be a nightmare, too (father dies, mother has to pay tax on half the house?)
Could be workable with large allowances though, but I don't hink you would ever get this pushed through in a democracy because it is too easy to put negative spin on it (even if it was in the majorities economical best interest).
I don't think that inheritance tax is a bad concept, but setting it higher than the gift tax rate is actively harmful and would not achieve anything.
You don't normally pay inheritance taxes for spousally shared assets. Is that not the case where you are, or did you purposefully give this the worst framing?
No, I'm not purposefully giving this the worst framing.
My main point is that setting it higher than gift tax rates is effectively pointless, and basically just punishes people for dying unexpectedly (and/or not planning ahead for their own death), and neither is desirable.
A purpose of death taxes is to even out the effect of not being born into wealth. I'd rather make it easier for living people by 'punishing' dead people than make it harder for living people by punishing them for not being born into the right family.
I absolutely see your point, but if you set inheritance tax higher than gift tax rate, then that rate difference does nothing for wealth inequality (because people are just gonna gift things in their 80's at the latest, or set things up legally to avoid the tax), while the inheritance tax is highly punishing for families of the unepxectedly deceased.
It’s not pointless. It may be counterproductive but kicking rich people when they’re down is popular among certain sections of society since it’s a subset of kicking rich people, which they like generally.
I'd advocate for that. The dead have no property rights. Survivors have no automatic right to get rich when uncle pennybags kicks the bucket.
All the rest is quibbling about logistics. Yes, we know rich people are very good at hiding their money.
> Could be workable with large allowances though,
Like US$13M ? That is the current situation in the United States.
Absolutely-- but if you have to exempt like 99% of your population from a law then its probably not too popular a concept (compare income tax, which a lot more people are actually fine with paying).
I still think this would have mainly negative effects if the gift tax rate is lower than inheritance tax anyway.
> but if you have to exempt like 99% of your population from a law then its probably not too popular a concept
It is hard to take this seriously. Are you seriously suggesting that the threshold is set at this level because of unpopularity rather than the power of the extremely wealthy? Have you looked at how the threshold has changed over time, and why?
> than the power of the extremely wealthy?
How does that make sense? In theory only the extremely wealthy have to pay the tax (not that they necessarily do that). In what way would it being so high benefit them?
absolutely. If you removed the limit and applied to the 99%, it would be the most unpopular tax in the country.
I don't believe there's ever been a situation (at least in the USA) where there was no threshold at all. So the argument is over its value, not its existence.
That said, sure, you're right. But why are you right? I would suggest it is because we live (in the USA, among other places) in a culture that strongly emphasizes the right to pass along generational wealth. But this is not universally true across time and space, and our culture took a different tack (say, by quoting august Republican figures from the late 19th and early 20th centuries), the popularity or otherwise would likely be entirely different.
The argument is about the exclusion threshold because that determines who it is applied to. People generally support taking from other people but not from themselves.
A flat 50% rate still extract much more value from the rich, but apply equally to the poor.
My perception is that hereditary wealth transfer is about as universal and it's phenomenon get when it comes to humans. Not 100%, but close to it.
> Are you seriously suggesting that the threshold is set at this level because of unpopularity rather than the power of the extremely wealthy?
I absolutely think that significant estate tax is an unpopular concept-- significantly more so than income taxation. A big factor is perceived "double-dipping"; there is some additional justification though because it seems very unlikely to me that less wealthy people could avoid this tax with the same effectiveness as 1%ers (who in many cases probably avoid paying it completely).
I fully agree though that the extremely wealthy leverage their power very effectively to prevent legislation that would affect them negatively-- a very clear example would be basically all of Trumps past and present tax policy, which you could IMO summarize as "tax cuts for the rich" without being too disingenuous, but which is absolutely NOT portrayed like that in mass media (and not perceived accordingly by most of his voters, which get diverted with "no more tax on overtime!" instead).
> Absolutely-- but if you have to exempt like 99% of your population from a law then its probably not too popular a concept (compare income tax, which a lot more people are actually fine with paying).
What? That is completely wrong.
If you gave the populace the option of massively lowering their income tax by slightly upping taxes on anyone with assets exceeding.. say.. $15 million, and massively taxing anyone with assets exceeding $100 million, do you think they'll cheer for the status quo or for lowered income taxes?
I think people will cheer for anything, given consistent positive reporting in mass media.
And media is typically not controlled by people owning <$15M.
If you wrap things nicely in populist rethoric and act in the best interests of media owners (i.e. the rich) then detrimental (for the median voter) changes to tax code are trivial to push through. Just compare the 2017 TCJA act, or the current lunacy-in-progress (essentially replacing progressive tax rates with regressive tariffs).
Sure, it would be easy to make people cheer for additional significant taxes for 1-percenters, but that does not really matter because its not gonna happen.
A huge number of people see themselves as "temporarily embarrassed millionaires" and oppose taxes on the ultrawealthy because they think they might one day be ultrawealthy themselves.
The temporarily embarrassed millionaire meme is a punchline to a joke (look at those stupid greedy people they don't know how stupid they are).
Inheritance taxes don't sit well for many reasons that are actually interesting to discuss
+ People's desire to support friends, families and personal interests is a core reason for an individual to work beyond individual self sufficiency. This makes it very easy to empathize with the millionaire impacted by gift / inheritance taxes that may never be applied to you.
+ Taxes have already been paid on this money - double dipping is very easy to cast as unfair.
+ Clumsy implementations of these types of taxes create situations where small family owned farms and businesses need to be liquidated to cover taxes causing more pain and disruption for families.
+ The constant slippery slope of taxes initially targeted at 'the rich' but over time effecting more and more people due to combinations of inflation and revenue seeking.
+ The simple fact that if the US just seized all the wealth of 800+ billionaires today - it would only be worth 6.2 trillion dollars [1], which doesn't even cover the 6.8 trillion dollars the government spent in 2024. So what do we do next year?
Do we need more revenue? Are we getting the revenue the right way (aka is everyone paying their fair share)? Maybe... But there is certainly a spending problem too.
1: https://inequality.org/article/billionaire-wealth-keeps-grow...
> People's desire to support friends, families and personal interests is a core reason for an individual to work beyond individual self sufficiency.
The fact that the income being taxed is "beyond individual self sufficiency," actually makes it easier to justify taxing. This isn't someone's food budget--it's the extra on top after one's life is fully funded.
> Taxes have already been paid on this money - double dipping is very easy to cast as unfair.
This argument has never made sense. Money gets taxed over and over. It's not like a dollar bill gets taxed once and then you mark it with a pen so it never gets taxed again. Money typically gets taxed when it changes hands: Your company pays you money, it gets taxed. You buy something from a store, that money gets taxed. The store owner issues a dividend to shareholders, it gets taxed. The shareholders get bank interest from that money, it gets taxed. There's nothing unusual about taxing a dollar over and over.
> Clumsy implementations of these types of taxes create situations where small family owned farms and businesses need to be liquidated to cover taxes causing more pain and disruption for families.
This is a sentimental-sounding trope that doesn't really happen in practice. In the USA, inheritance income under $13M doesn't even get taxed at all. This is well outside of the scope of "small farms and businesses." Inheritance, in fact, tends to benefit recipients tax-wise: An heir is allowed to adjust the cost basis of an inherited asset to its market value on the day of the previous owner's death, so that all the previous owner's unrealized capital gains never get taxed. Sitting on $1M of capital gains from your meme stock that you don't want to pay taxes on? Just leave it to your kid in your will--those gains won't be taxed!
The other commenter addressed your other two issues.
I agree with almost all your points, except two:
The US estate tax specifically got basically bigger exemptions every time it was touched (even adjusting for inflation), and returns have been falling precipitously for basically the last 25 years. If you own less than $13M at death, it does not affect you at all right now.
> The simple fact that if the US just seized all the wealth of 800+ billionaires today - it would only be worth 6.2 trillion dollars
Sure-- but I think this is a bit of a strawman. To me, and a lot of people that argue in favor of wealth/estate taxation, the purpose is not to substitute income taxes (like what Trump wants to achieve with tariffs)-- the goal is to get wealth inequality back under control, not to balance the government budget with those tax returns.
Another perspective on wealth distribution is that the top 1% own a third of the country. In my opinion, if you have enough wealth (and liquid enough wealth) to outright buy an average home at sticker price, then you are part of the problem;
I absolutely don't want to compete with people like that on the housing market, and I don't want them to extract excessive rents from people like me (i.e. not-1%ers) either, but thats exactly what happens right now.
> But there is certainly a spending problem too.
I don't really agree with this. I think (expected) government responsibilities have grown tremendously over the last century (mainly for good reason).
I'm confident in saying the the American-favored approach to healthcare ("everyone takes care of it on their own, and negotiates/pays for it by himself") has completely failed for IMO very clear reasons (demand for healthcare is inelastic and only government can force pricing transparency, prevent collusion and a generally fair provider-market in the first place-- obviously).
I'm also confident that shifting back more pension responsibilities onto citizens themselves is also a bad idea, because it creates extremely bad potential outcomes in case of an economic crash. Government providing a survivable social security baseline is just a very clearly good idea to me.
Those two points (healthcare + social security) account for the vast majority of government budget, I think they are basically a good idea, and cutting costs with foreign aid, research funding, environmental regulation/enforcement etc. has IMO neither the potential to save significantly in the first place, nor is it beneficial to do so by itself (I'd even go so far and call the whole doge initiative a thinly veiled propaganda department for the current administration).
A 100% inheritance tax would encourage entrepreneurial behavior and force young people to take risks that they wouldn't otherwise. Capital would operate more efficiently if everyone was on the market in that way. In fact, the inheritance tax would be the only tax if it was total; there would be no other tax burden in one's entire life.
> entrepreneurial behaviour and force young people to take risks that they wouldn't otherwise
Or get them stuck in a permanent debt cycle.
> the inheritance tax would be the only tax if it was total; there would be no other tax burden in one's entire life.
Wouldn't everyone be incentivized to spend as much as they feasibly can before they die and not accumulate too much wealth?
I guess it depends on the specific implementation but the optimal approach would be to take on as much debt as you can to keep your effective net worth close to 0. So even a 100% tax on that might not result in a lot of revenue...
Your view about each generation tending to fully 'break' with their parents, in a way (economically, spiritually) strikes me as particularly narrow. Perhaps it is so where you live, but this is simply not true for vast populations all over the world.
Most populations in the world: Latin America, China, India, Japan, Koreas, the muslims and the jews, and more.
However, I think the grandparent post refered to Great Britain since the paper in question is english.
You've just named three of the top global cultures for transfer of intergenerational wealth down the patriarchal line.
:/ Yes, I was agreeing with the parent post, which disagreed with the grandparent post:
"Your view about each generation tending to fully 'break' with their parents, in a way *strikes me as particularly narrow*. "
I then added examples of vast populations where sons don't isolate from their parents.
A 100% inheritance tax is quite silly imho and very unfair for the parents. One of the reasons many people strive for success is to secure some well-being to their children... well at least myself and many people i know.
Exactly. It creates perverse incentives. One of the main drivers for millions of humans to work harder is to leave a better economic situation for their children and grandchildren. You remove that incentive and the economy will tank immediately.
It’s not only perverse but completely anti-human.
... the perverse incentive to raise your children to stand on their own two feet?
The potentially perverse incentive to spend every single $ you have before you die? If everything you have goes to the government after you're dead and you have more money than you personally need you can still spend it all on your children before you die.
Presumably this 100% tax would also apply to gifts cause otherwise it wouldn't really work but where does it stop? Parents can't pay for college? Buy their children a car? Go on vacation with them? Spend any money on them at all so that they would "stand on their own two feet"? Be banned from giving any financial support to their children when they reach 18?
I mean... it's an obviously not a good idea.
Also the most optimal strategy would be to spend all the money you have in addition to getting a reverse mortgages on any property so that by the time you die your net worth would be as close to 0 as possible. Or just selling everything and buying an annuity.
Why is spending everything before you die a perverse incentive?
Lower savings rate, higher inflation, higher interest rates, less capital available for investment. So most capital intensive sectors wouldn't do well.
A lot more volatility, without a (or much smaller one) buffer most economic shocks would have a bigger impact on the economy.
Also there would still be a lot of inequality it would just be intra-generational.
Then again.. all the annuity money has have to go somewhere. So maybe the insurance companies would become the primary sources of investment capital (which wouldn't be great). A lot of uncertainty though i.e. buying a house if you have a family would become much riskier..
I'd need a source to back up those claims, as you note it's not trivial to understand how economy would react.
I also don't see why buying a house would be much riskier? If you buy a house for your family it's because you either prefer the lifestyle or think it provides economic advantages over renting. Given you only need housing when your alive, I think what happens after you pass is not as major a concern as presented.
> I'd need a source to back up those claims
A source like what? I don't think there are many studies refuting bizarre not well thought out policies. Also it's pretty hard for me to argue against a suggestion that's so ill defined.
Albeit a massive increase in consumption and a reduction in savings would be the most obvious outcome (with all the implications of that).
> after you pass is not as major a concern as presented
Therefore there is no point for you to own your house. When you get older you either get a reverse mortgage or don't buy property in the first place. There would be no rational reason to own property beyond a certain age.
If no sources exist, then you must accept making claims such as this would 'lower savings rates' are simply not backed up. Maybe it will... maybe it won't.
So what if there is no reason to own property beyond a certain age? Even if we take this claim as true... that doesn't explain if this is a good or bad thing.
> then you must accept
I don't, because this argument is nonsensical (I mean your point about source specifically). Unless you disagree with some of the core principles of modern economics (not saying that you have to agree with them..) that would be the most obvious outcome.
> So what if there is no reason to own property beyond a certain age?
Well that would mean that the savings rate would go down (for better or for worse).
You've not established that your suggestions are core principles of modern economics or derived from them.
For example, you are asserting there would be 'no reason to own property beyond a certain age'... which isn't supported, and then jumping to the conclusion that that would lower savigns rates.
None of this is clearly true, just supposition.
> which isn't supported
The general consensus amongst most economists is that humans behave in a rational way? Not spending all the wealth you before you die would be irrational if your children won't inherit it.
Of course in reality that's often not the case especially these days so it might not be sufficient enough.
> clearly true, just supposition.
Well by such standards every discussion on any policy that hasn't been tried is meaningless because there isn't any empirical evidence.
The goal are in no way mutually exclusive.
I can want my children capable of providing for themselves.
I can also want improve their situation beyond that.
But wasn't the "society" paid off by all the "living taxes" before the person died?
Imagine having nothing, your parents dying, you, an eg. broke college student inheriting a 2 bedroom apartment, which is somehow worth $1mio, and you owe so much tax (that you can't pay) that you're forced to sell the apartment, the only place you've ever known.
With 100% inheritance tax, i'd literally stop working as soon as i reached enough money to retire. Why work harder if it all vanishes when I die, and my hypothetical kids gain nothig? Or, more realistically, i'd convert stuff to cash and give it to them without the government knowing.
Tax the income, close the loopholes, once the tax for something is paid, the rest should go to the person, the government has got its share, it has enough.
And i'm saying this as someone who already lives in a country without inheritance tax (in most usualy cases).
> But wasn't the "society" paid off by all the "living taxes" before the person died?
Governments look holistically at their tax revenue. If there is an inheritance tax, and they expect to get a certain amount of revenue from it, then other taxes will be lower to compensate.
And vice versa: if an inheritance tax is producing revenue, eliminating it will result in higher taxes elsewhere. This is one reason such a tax continues to exist. Inheritance taxes tend to have very high exclusions so most people don’t pay them. And getting rid of them looks like charging everyone else more in order to lower taxes on the rich.
Some would say: governments look holistically at it - if there is a way to get away with extracting more taxes, they will.
With that said, I'd like to say that I enjoy living in Norway and I enjoy our tax model and the health care and education system it funds.
I just wish there was as much scrutiny on how the funds are used and as much creativity on getting as much as possible for them as there is scrutiny on how much each of us should pay and creativity around how to tax us more.
I like how you suggest that other taxes will be lower to compensate. That hasn't been my experience in general. I'm sure it's happened occasionally but I don't think it's the rule.
This leads to what we have today: insane levels of wealth inequality.
Everyone that inherits fortunes from their parents get to live life on easy mode while every one else is poorer, with less assets and barring winning a lottery ticket, no way to ever catch up. Wealth creates a feedback loop that if gone unchecked will hoard all assets from everyone else.
We can't have both meritocracy and inheritance as they are mutually exclusive. If we want to keep telling people there's any modicum of truth to meritocracy, we have to stop all this inheritance bullshit. The particulars of it can be discussed with caps based on amounts, for example, but that's not the point.
There's a reason that most wealthy people from the past are still wealthy today and I can guarantee you it's not through their own merit.
Tax wealth, not work. There should be no billionaires.
> There should be no billionaires.
These moral judgements aren't great ways to make economic decisions. A billionaire can just be someone who owns a lot of shares in a company that's currently valuable. A company's value (in this sense) is just the total number of shares multiplied by the last share sale price.
It doesn't mean they have a billion dollars in cash. The billions don't even exist. They're just a value based on the last transaction value of the company's share dealing.
It's not a moral judgement. Morals have nothing to do with how power works. Society does not benefit from small groups owning enormous amounts of power.
Whether they're kings from "divine right", corrupt nepo babies or even legitimate geniuses. Nobody should have that much power.
There's a big difference between money and power, though. A TSA agent can affect your life in a big way without the use of any money. That's power[0].
There's a big difference between money: voluntarily trading value for services and goods, some of which might negatively affect you, and power: trading nothing for direct control of aspects of your life.
[0] Not inappropriate power, or not in theory
That they can borrow money from the banks as if they do exist says you're wrong.
Well yes, companies do exist. How would you handle that? Nationalize all large businesses? That... rarely worked out historically.
> That they can borrow money from the banks as if they do exist says you're wrong.
I can borrow money for a house even though I don't have money to buy a house.
> These moral judgements aren't great ways to make economic decisions.
In my experience, a lot of people who make these kinds of extreme claims (no billionaires, no inheritance, etc.) do not seek plausible economic solutions, they only want the moral high ground.
In my experience, people that simply attack other people instead of contributing to the discussion are the ones that want the "moral high ground".
That statement is in no way moral. Not sure why GP assumes that. It's simply not beneficial to society for small groups to accumulate disproportionate amounts of power.
But as always, we have some "future billionaires" rushing to defend them.
> It's simply not beneficial to society for small groups to accumulate disproportionate amounts of power.
Power and money aren't the same thing. Someone who can throw you in jail or stop you getting on a flight can be on a very low wage indeed.
> But as always, we have some "future billionaires" rushing to defend them.
This would be considered one of those attacks you just mentioned.
> Power and money aren't the same thing.
Kind of are in a capitalist society. Sure you need extra steps but it's still power. No need to go far... Elon is living proof of that. Other billionaires do the same but they don't need all the attention.
You're arguing you don't necessarily need money to have power but if you have money you absolutely do have power, which is my point.
> This would be considered one of those attacks you just mentioned.
I know... I couldn't help myself to hit back at a useless comment.
A capitalist democratic society is about the only type I know of that tries to separate money and power.
Normally the monarch or the Socialist dictator or the lord of the land controls the money and the power.
IDK if I agree with you, since in theory modern socialism tries to spread power, although it never quite worked like that in history. Maybe that's an utopia.
> A capitalist democratic society is about the only type I know of that tries to separate money and power.
But when I read this I can't help but think the same utopia is under capitalism.
In theory there's a separation. In reality billionaires can purchase politicians, media, etc. and get power through those means. I have never seen an example of this not happening.
If there were any effective ways of stopping money from meddling with power I'd agree with you but reality always smacks theories in the face. You say it tries to separate them but then you have lobbying (or the non-legal version of it) in every government as an example. It's an utopia just the same.
> Tax wealth, not work. There should be no billionaires.
But what is wealth? And when should you tax it?
Let's say I take a piece of duct tape and a banana and ducttape the banana to a wall.... how much tax should I pay for that? I mean... how much could a banana cost?
If i sell that "art", for example for $6.2M (yes, it sold for that much), then sure, i did my "work", earned $6.2M, and in the current system i'm taxed for my "work" (well.. income for my work).
So, by your logic, when should I get taxed? And for what value? The net worth of that banana on the wall is $1, so should I be taxed on that value? But if someone wants to pay $6.2M for that, should my tax change, even before it's bought? Do I get my taxes back if he changes his mind?
What if instead I start a small company named Sava (a river nearby) that sells books. Do I get taxed now, when the value of the company is $10k in books in the warehouse? What if someone believes in my company so much, he wats to buy 1 millionth of my company for $1000, should I be taxed on the theoretic value of my company (1B now)? Or should I be taxed only when I actually sell that stock and earn the money?
Yes, life is not fair, kids of rich parents start with a lot of money. My parents were not rich, but believed in the future of computing and bought me (a kid back then) a computer in the time when you had to take out a loan to get one. My friends parents bought him a motorcycle. I'm an above-average paid 'developer' now and he works minimum wage in a factory. So, should i lose something or have to pay something back, because my parents made better decisions than his?
Instead of focusing on taking away stuff where the taxes were already paid, lets rather focus on people like bezos paying the same amount of taxes as other businesses do, like mom and pop book stores (i'm talking percentages, not net values), and to stop the abuse of every goddamn tax loophole they abuse now.
You're basically describing one way the rich dodge wealth taxes and saying we can't do it because it's hard to figure the value of some things out.
I don't deny it's very tricky and people will absolutely do their best to dodge as much as possible, but that doesn't invalidate the purpose they serve. You can't claim those hundreds of properties you have are worth $1.
I'm by no means an expert but my idea would be to tax rich people yearly after a cap. We don't want to tax workers but the whole swath of parasites that simply extract from society.
Your company example is odd. Can you lend based on your theoretical valuation of $1B? Then perhaps we tax if you do. I don't know all the answers off the top of my head and neither should I.
That doesn't mean we let people accumulate wealth infinitely. It's a problem and there's no way to ignore it. The more wealth is accumulated, the more they accumulate and for a lot of assets it is literally a zero sum game. If they own everything, we own nothing.
Posing edge cases and possible dodge scenarios like you did is exactly what a politician should be spending their time on when proposing these.
> I'm an above-average paid 'developer' now and he works minimum wage in a factory. So, should i lose something or have to pay something back, because my parents made better decisions than his?
Not more than what's fair. Unless you're secretly a multi-millionaire, this wouldn't ever affect you. I don't understand people's fears of taxation on the super rich when they aren't even close to that.
These taxes are not for working people. If you don't live off a trust fund from daddy you probably don't have to worry. Well, if we're being honest, this will never happen because they own the politicians too... but a man can dream.
Tax consumption, not work or wealth.
So - this is quite a good idea, but worked example: what if I work for a UK/US business, but live in a low cost of living country? Is that just fine, because I'm still consuming resources where I'm working? Or is it a bit of a loophole (can't tell)?
> Tax wealth,
Perhaps. However an extremely high inheritance tax is an irrational way to do that. It would incentivize everyone to spend all their money/wealth before they die e.g. directly or just by selling all their property and buying an annuity.
A massive increase in consumption wouldn't necessarily be the best outcome. Though I do see some benefits.
> we have to stop all this inheritance bullshit.
That would only work if you ban parents from giving any gifts or financial support to their children. Which is a very slippery slope...
> Tax wealth, not work. There should be no billionaires.
NB. This does not mean that Inheritance should be a taxable event! There would be less need to have inheritance tax if we had a consistent wealth tax.
It remains obvious to me that inheritance drives social inequality, and similarly it is obvious that parents are going to resent not giving their children as much help as they can.
Yeah, if we had very effective wealth taxes, I could see it being less relevant. Right now, it kind of works as a very rare wealth tax and is probably dodged quite a lot by transferring ownership beforehand. I'm no expert since but I'm sure it's full of loopholes.
But it's one of the very few wealth taxes we actually have today...
> I'm sure it's full of loopholes.
Yeah, there are a few very well defined loopholes - gifting early, pension wrappers, some trusts, agricultural land, non-dom etc etc - some are being closed. In general the richer you are the more likely you are to be able to minimise and avoid the tax.
What happens is gifts are given out before death and names put on houses so the tax is paid by the poor or those who died unexpectedly.
> the accumulated wealth being redistributed over both society
That's fair in principle. Yet in this case but his brother didn't really have enough time to accumulate that much additional wealth after inhering it from his father so it's a bit of a lottery.
Also inheritance taxes are quite tricky to enforce and it's very hard to close all the loopholes (also the revenue isn't exactly reliable). IMHO a wealth tax seems like a better idea (then again there are quite a few complications as well as Norway's recent attempt has shown...).
> because the whole concept of inheritance will go away.
I fear the opposite. As property prices continue increasing and middle and lower class incomes stagnate inheritance might again become one of the few ways that are left for the majority of the population to attain and any significant wealth (I mean middle class level i.e. a hour or two). Birth rates also being so low might make it even more significant.
Ofc they grow "attached", because it's free shit - I'd say it's got 99% nothing to do with nostalgia or attachment to their parents and more a huge boon to their wallets. The number of people that whine about inheritance taxes is ridiculous. Almost as ridiculous as the number of people (on here especially) that think that owning a second/holiday home is practically a human right (for them).
Let me introduce you to the concept of "property rights." What right do you have to tell someone who they can pass their property on to at their death? Your definition of "fair" is utterly irrelevant.
Property rights are meaningless without a social order that protects them. Aka a government and a civilized society with high trust.
The value of that property increases when others in the society prosper. Government programs funded by “taking people’s money” (aka taxes) very often make “private” property more valuable.
People with the “f*ck you, got mine” mindset either don’t get this or selfishly don’t care (sometimes for understandable reasons, e.g. they come from a low trust area).
Of course, there are lots of nuances and complex implementation details. Like how much exactly does a specific program affect different groups and on what time scales. But the fundamental principle is straightforward and essential to a healthy society.
Saying "you don't have a right to pass on your property to your family" is the opposite of high trust. I'll grant that the moral answer beyond a certain point is to limit your children's inheritance to what will give them a comfortable life, and then engage in philanthropy a la people like Andrew Carnegie.
But claiming the government has to force people into this is low-trust to the extreme. It's saying "we're going to take these things we already taxed you on, because you can't be trusted to use them responsibly and we can."
You can't regulate your way into everything. Good government can only exist alongside the unwritten rules that made people like Carnegie decide that the right answer was to give their wealth away to the public.
I was responding to your suggestion that property rights are supreme over all other moral and societal considerations.
>Property rights are meaningless without a social order that protects them.
Where do you delineate this worldview from a simple extortion shakedown? e.g. your house is more valuable when it isnt on fire and your family isn't dead.
It still leaves the question of what is an appropriate tax to pay for social order? is it 100%?
The worldview I outlined just suggests there is some amount of obligation that we all owe to society for enabling our basic rights and prosperity (with varying degrees of effectiveness, unfortunately).
And it also argues that some sort of governance structure is always present — official and explicit or implicit and unintentional - so we might as well try to make it a good one.
The details can and should be debated and discussed. The project is never over.