Death and Taxes: Why Inheritance Tax should be replaced with a Capital Receipts Tax

Article

There is a strong case on the grounds of equality of opportunity for taxing inheritances. Large inheritances give some people an unfair and unearned advantage in life.

Supporters of taxes on wealth in the UK have weakened their case by defending the current Inheritance Tax regime in spite of its deficiencies. Inheritance Tax as presently formulated is highly unpopular, raises little money and can be avoided by the very wealthy. It is also not a tax on inheritances, but a tax on estates. It could be reformed, but a better option would be to abolish it and replace it with a Capital Receipts Tax.

A Capital Receipts Tax would be a fairer means of increasing equality of opportunity. The UK should introduce a progressive tax on lifetime gifts above a certain threshold.

Related items

  1. Towards universal opportunity for young people

    Outlining a vision for young people which could increase social mobility while also reducing inequality and disadvantage, so that every young person has the opportunity to build a decent life.

  2. One year in: the government is making decent down payments for the years ahead

    It’s fair to say it hasn’t been a straightforward first year for the government. 

  3. Britons back local leaders with fiscal firepower

    “Death and taxes,” they say, are life’s only certainties. But there’s a third - wherever taxes are controlled, power lies.