He spoke complete nonsense. Like the speaker earlier in the day he thought inheritance tax was paid on small businesses. Where do these people come from?
Then we had the argument:
People don’t like this tax
Which is quite absurd. No one loves taxes. I don’t. But I do like what they do. So it’s an absurd question to ask if people like any tax, or not. Of course the answer will be that they don’t.
But worst of all is the usual twaddle he peddled that Inheritance Tax is triple taxation (apparently it’s income tax, stamp duty and Inheritance Tax). There are two answers to this:
1) There is lots of triple tax in this country. Take earnings form employment spent on alcohol: that’s income tax, national insurance, VAT and alcohol duty for starters. So we have quadruple taxation. So what? This spreads the tax base. That’s the basis of good tax design.
2) It so happens there isn’t triple tax on a house included in an estate charged to inheritance tax. First of all it’s the estate that is charged, not the house. So that’s only one tax. But even if the whole estate were a tax then a) the house will almost certainly represent an inflated value probably hundreds of times the total paid for the property if the deceased is of actuarial life expectancy. I recall , for example, my parent’s first house cost under £2,000. It must be worth more than a hundred times that now. If included in their estate now the increase in value would never have been taxed, the amount subject to income tax to pay for it would have been less than £2,000 and the stamp duty under £100. That’s not triple taxation. Given the generous allowances for Inheritance Taxation that’s much less than single taxation.
So let’s stop the misrepresentation and get down to the facts. The reality is that the argument about Inheritance Tax is about greed: people saying “I want to keep all the cash and want none of it to go to the State to create greater social justice and opportunity for those who might never be in the top 7%” (and that’s 93% of people, by definition). And greed is always ugly, which means it’s hidden behind lies and false arguments. .
Second, let’s be thankful that at least one tax might be slightly deflating the housing market. After all something has to do so because anyone under 35 now relies on having wealthy parents to buy a house. Nothing could crush the enterprise spirit more than this. What the Tories need to realise is that if every penny you have has to go into paying for a house, there is no chance of taking the risk of starting a business. You’re in the drip of death of a debt for life (and mortgage by the way means ‘grip of death’).
But despite this the Tories want to abolish the only tax that is doing anything to stop this economic and social madness. I despair.
And I’ll be candid: I distrust their motives. Because I don’t think they’re fools. And if that’s the case then they know all I’m saying is right. Which makes their presentation of their tax policy far removed from the substance of the policy they’re really pursuing, which is one of tax cuts for the rich of the sort Bush pushed through in the States at the start of this century, and which has created so much harm and not one jot of benefit there.