Although we’d prefer it to be love or lust that brings down Downton Abbey we know it will be boring old Inheritance Tax that wields the fatal blow, and now the £325,000 threshold threatens even the legacy of Del Trotter’s high-rise pad. The Chancellor’s tanks are well and truly on our pretty modest lawns. Despite stalling house prices, around 3 million of us will pay death duties this year – at an eye-watering 40% – yikes!
Tricky one this for the Government whether you’re right, left, red, green, yellow or blue. Say what you like, £4.7bn is handy to have when you haven’t got it. It’s what UK Plc raised through inheritance tax in 2015-16. At less than 1 per cent of GDP, it’s not a huge amount of lolly, but oh dear me – if you were to jack up the £325k threshold you’re ‘feathering the nest’ of the privileged and if you put it down you’re hitting the ‘working man’. Heads you lose, tails the opposition licks its lips.
No one likes it – a tax on the stuff you worked your arse off for and bought with your already taxed income. Of course if you’re rich enough you can pretty much avoid paying it at all. An estimated £9bn goes uncollected every year thanks to the efforts of creative accountancy.
My point is though, why doesn’t the Government re-position this tax in our psyches? Instead of people of every political faith attempting to avoid ‘giving it to Phillip Hammond’ whom they variously suspect is using it to…..
- Punish the poor (Labour)
- Pay for freeloading-immigrants (UKIP)
- Replace Trident (SNP)
- Develop more airstrips (Greens)
….why doesn’t the government encourage us to see it as our legacy to a better world – the ‘Future Planet Bond’. Why doesn’t it re-position this tax from an unpalatable obligation which fuels more of whatever our council taxes, VAT, corporation taxes etc etc supported during our lifetimes, to an opportunity for us to ‘return the favour’ to a wondrous and precious world.
Sound like vacuous marketing spin? OK, let’s make it real. At nearly £5bn this tax is more than our environmental budget – why don’t we fund that budget entirely from inheritance tax receipts? Hand on heart – you’d know your unavoidable tax was going on wildlife conservation, national parks, flood defences and fighting animal and plant disease.
The really fat cats –Gates; Branson; Zuckerberg are all focused on the benefit their wealth can deliver for future generations. People with over £325,00-worth of ‘stuff’ should, or could be encouraged to, feel something similar. While arguably all of our taxes contribute to a better future, a bit of overt marketing and budget re-distribution could transform our view. Who could argue with the mindset that, while your physical self has ceased/shriveled up/gone under a bus, your lifetime achievements ‘live on’ in the natural environment.
You’ll leave some money to your kids (and remember you’ll get £100,000-worth of the family house exempted as of next Spring – Mr Osborne’s own particular legacy) and make a contribution to the planet for your grandchildren.
Supporting my earlier blog viz-a-viz the ‘yesteryear’ complacency over the perception of engineering, the Government really needs to bash on in a new world. As a nation we’ve developed a classless appetite for watching people bake cakes and ballroom dance while we consider the approach of driverless cars and drones taking our jobs. This is how we live, so rather than being a pejorative term, perhaps we should have more ‘populism’ ie a Government that frames a future in language that appeals to us.
Doesn’t the, ‘Planet Payback Fund’, sound a whole lot more deserving of your sweat and toil, than having to grudgingly hand over ‘Death Duties’?