...a blog by Richard Flowers

Sunday, August 20, 2006

Day 2049: Death and Taxes


Listening to yesterday's Saturday morning political show on Radio 4, Daddy Richard nearly choked to death on his elevenses at the OUTRAGEOUS remarks of a Mr Grover Norquist, president of some people called "Americans for Tax Reform".

"Give an inheritance to a Republican and they found the Rockerfeller Foundation; give it to a Liberal and they booze it away or snort it up their nose!" he spouted.

"Doesn't your current Republican President have an inherited fortune and convictions for drink driving and cocaine abuse?" was the reply Sheena McDonald ENTIRELY FAILED to use to put this lying loon in his place.

Mr Grover (the Republican Muppet who lives in a dustbin, presumably) was SUPERFICIALLY on the show to make the case against Inheritance Tax. This morning former Nu Labour minister, Steven Byers - one of the few people to resign from Lord Blairimort's government without being replaced by Dr John Reid - pops up with the idea that the government should abolish Inheritance Tax. I wonder if yesterday's radio show counts as a trailer?

My fluffy friend Mr Frank Luntz came up with a clever wheeze about this to help out his chums in the Republican Party (who are very rich because they got lots of money from their daddies).

To convice lots of Americans who struggle to live on middling or low earnings, the ones who always get called "Average American Joes" (what if their name ISN'T Joe?) to convince them that it is BAD to take money from the estate of billionaires, clever Mr Frank had the Republicans start calling it DEATH TAX, as though it was a tax paid for DYING.

By an AMAZING coincidence, Mr Byers today calls Inheritance Tax "a TAX on DEATH"!

"Calling it 'Estate Tax', most folks think 'I haven't got some fancy European estate' so it doesn't apply to me. But call it 'DEATH TAX' and EVERYONE thinks it applies to them!" said Mr Grover - rather blowing the gaff.

Of course, it ISN'T a tax on the person who has died AT ALL. It is a tax on the FREE MONEY that the people who inherrit get without having to do any work for it.

It should be called the MONEY FOR NOTHING TAX!

If the taxman does not get his money from the MONEY FOR NOTHING TAX then he will have to get it by taxing MORE of the money that people have worked hard to earn. And increasing taxes on EARNED income would only make it harder for most people to make ends meet and leave them with LESS to give to their children in the end as well!

Mr Grover Muppet in America would probably say that you could cut the MONEY FOR NOTHING TAX by cutting the amount that is spent (except for the BIGGEST slice of spending: the spending on bombs and guns and missiles and probably laser death-rays too). Mr Grover Muppet would probably say that he should not be taxed for selling his mother, either.

In this country, Mr Byers knows that he can make his suggestion and it will put Mr Balloon's Conservatories on the back fluffy foot, because Mr Balloon does not have the option to cut spending, what with vaguely alluding to maybe saying that he might promise that he won't cut public services. Mr Balloon would be back to raising on the money that people have worked hard to earn and using it to give to very rich people to let them off tax on the money that they HAVEN'T worked for!

Mr Byers, it seems, wants to steel the Liberal Democrat idea for GREEN TAXES, but unlike the Liberals, instead of giving the money to EVERYBODY through a general cut in income tax, he want to give it all to the RICH!

It is clear that Mr Byers is very concerned about inheritance. Specifically, who will inherit when Lord Blairimort goes. (Clue: it's not going to be you, Mr Byers.) He begins his piece with a long SOB STORY that he then admits is completely MADE UP. This means that he has FIXED all the facts to be as HORRIFYING as possible without having to do any real research. Some people might call this a bit of a CHEAT!

BUT, even though he is EXAGERATING there is a bit of a point in what he says, because otherwise how would he get people to believe him at all?

It is very understandable that people want to pass on some of their hard-earned money in order to give their kids (and BABY ELEPHANTS!) a better start in life. But this does lead to some inequality of opportunity. People like Mr Balloon, say, get FAR MORE of a head start than most people's mummies and daddies can EVER afford to give them. It is much easier to cycle to work (once a week/with chauffeur following) knowing you do not have a mortgage on your million-pound home to worry about!

So there is a BALANCE to be found. People should be able to give reasonable amount to their elephant whoever they want but not so much that it is SILLY. The difficult part is deciding where that balance ought to be. Here are some pointers to help you: TEN MILLION pounds is OBVIOUSLY enough that if you got it you wouldn't have to work again EVER. So that probably qualifies as SILLY. TEN pounds will by you enough sticky buns for the day. So that is going to be WAY less than REASONABLE. The balance is somewhere IN BETWEEN!

Mr Frown has not kept his eye on this (or has he?) and the balance has now tipped the other way because house prices have gone up and up so much that lots more people are getting taxed. The average price of a house is now £250 thousand pounds, and Inheritance Tax starts at £285 thousand pounds. It is all too easy for ordinary people to end up paying! Mr Frown assures us that only 37,000 people are doing so, but this is DOUBLE the number before Mr Frown came to the Treasury, and a lot more will be caught - or at least FEAR that they will be caught - if he carries on the way he is going.

This is BAD too: people might start to think that Mr Frank and Mr Grover are RIGHT (not just very far right) and that it IS an unfair tax - rather than it being a tax on an unfair ADVANTAGE for PLUTOCRATS.

Tax should be FAIR and be SEEN to be fair. Calling something a "DEATH TAX" is just a SMOKE SCREEN to stop people from seeing where the REAL unfairness comes from.

As for Mr Grover spluttering NONSENSE about inheritances being snorted up the nose, all I can say is I am GLAD that Mr Balloon would never do ANYTHING like that!


Will said...

Is Inheritance Tax charged on the full value of an estate, or the amount received? e.g., would a family of five siblings inheriting a million pound property divided equally between them see it taxed?

By the way, watching season 3 of The West Wing recently I noticed your fluffy friend Mr Luntz was a consultant on it.

The Cat said...

Will - at present IHT is charged on the estate, not the recipient.

So if I feel like sharing out my estate between my 5 kittens from my 2 batches with Mrs Cat, the total tax going into Mr Frown's pocket will be the same as if it were all inherited by just one kitten (the black & white one with the pink nose) or indeed were shared out amongst the 57 different illegitimate kittens I have fathered over the years.

That clever chap Mr High Voltage Cable has suggested in his "Clever Ideas On Tax" paper that the system should be switched to taxing *recipients*, which in turn would encourage people (& cats) to share out the inheritance more widely.

Bridgford said...

Indeed, although the repsonsibility for paying the tax falls on the residuary legatee IIRC from my IHT tax days.

Will said...

Thanks. Good on Mr High Voltage Cable - that's much fairer and more sensible.

Tristan said...

Don't get upset about US 'conservatives' insulting 'liberals' they really mean rich do-gooder socialists who think they know best (like Mr Blair and his friends)
Admittedly, the US Republicans seem to be rich nut-cases who think they know best too...