I've just done Radio 5 Live. We were meant to be discussing inheritance tax.
Scheduled start time was 9.00. On air time was actually 11.45.
Then I was pitted against Sylvia Tidy Harris, a woman best noted for saying no-one should employ women below aged 45 as they might have children.
She presented two scenarios where she said inheritance tax might be due. First case:
Two young people start in the City on salaries of £35,000 each and buy a house together worth £300,000. Immediately they're chargeable to inheritance tax.
This is what's wrong with this:
- It's not related to real life - a tiny proportion of people start on £35,000. The average wage is £27,000. This women is a fantasist to think this is normal.
- These people would have a mortgage of maybe 100% of the value of their home. That's offset against it's value for inheritance tax. So net worth is zero. No inheritance tax due.
- She interjected:
No, their parents bought them the house
Now we have a new scenario. They do have an asset worth £300,000. But it's shared. So that's £150,000 each. So there's no inheritance tax. It starts at £285,000. And let's also be clear. They've got to die first. Not likely.
So, we move on to her second claim. This is:
A person owns an ordinary house worth £200,000 and a small business worth say £150,000. It's so unfair they have to pay inheritance tax.
Which is why, of course, they don't owe any. All small unquoted businesses are exempt from inheritance tax.
In other words this person had no idea whatsoever what she was talking about and had the nerve to go on national radio and talk about it. I was furious. I fear it showed.
But is this the propaganda the Tories will resort to to get tax cuts for the rich? I think so. Sad, isn't it?
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It’s almost as if the BBC deliberately chose someone who was incompetent to make the Tories’ case for them.
But I’m sure they’d never do such a thing…
Dear Richard
I can well understand your frustration.
I am presently pushing a petition via the No.10 Downing Street petition site, regarding ths issue.
I am so amazed that so few people actually sit back and look at the facts.
It’s smple maths and doesn’t take a brain surgeon to work it out.
I do, however, think that the issue needs to be looked at.
A sensible level in my eyes would be a level of £500,000 with adjusts up and down with inflation (incorporating an index to the property market).
Your opinion on this would be helpful.
Regards
Sharon
Sharon
I accept that a review of the start point makes sense
But I also expect house prices to be falling soon
Richard
Hence the reason I believe the level should flow both ways.
I feel the issue is often abused for its emotive value and the “class war” band wagon just love jumping on it with their battle cry of “it’s the rich just trying to protect their fortunes”.
Long gone are the days when only the upper classes and aristocracy paid inheritance tax.
Always struck me as a non-issue that has for some time enjoyed an artificially high profile due to the activities – and perhaps the relative wealth of the funders – of right-wing lobby groups. The campaign against the ‘death tax’ hasn’t had anywhere near the profile of its leader in the States, but this seems like a serious boost for it.
On Richard Brown’s suggestion of BBC bias, I can tell him that I caught Radio 5 discussing this last night. The panel included a Conservative MP, who favoured the cut; a lobbyist from Taxpayers’ Alliance; a ‘tax specialist’, namely George Bull (I think) of Baker Tilly, who has been known (though perhaps not by the Beeb) to lobby against inheritance tax; and someone from IPPR as the token resistance. Not, needless to add, a terribly enlightening conversation; except on the extent to which the first three were able to convince themselves that this was not politically foolish, and that they seemed not to have even thought of the inequality and poverty impacts of knocking a percent off tax revenues in favour of the wealthiest.
Sharon
But if being in the top 7% of estates is not a definition of capacity to pay, what is?
I’m certainly not asking for class based taxation. That would be absurd. But capacity to pay a tax has to be an appropriate critrion for choosing who should pay it.
Richard
[…] Inheritance tax: If you’re going to talk about it please understand it […]
The front page headline in the Daily Telegraph on 23rd December 2005 ( I think that was the date) read “Letwin: we will redistribute wealth” and he went on in the article or in the report of what he had said to talk of thereby “empowering people”.
I have been lobbying Michael Howard and Oliver Letwin since the appointment of Michael Howard’s shadow cabinet and subsequently David Cameron, George Osborne and Oliver Letwin in favour of ‘Inheritance’ Tax Reform and British Universal Inheritance. How else are they going to redistribute wealth? By abolishing ‘Inheritance Tax’ and exempting grand country and London houses from Capital Gains Tax? I am utterly disgusted with this proposal of theirs.
It seems that the Conservative Leopard has in no way changed its spots. What a bunch of frauds they would seem to be! My only sneaking hope is that they are keeping up their sleeve a Cumulative Negative and Progressive Lifetime Capital Receipts Tax, based on taxing recipients rather than donors. But I am no longer holding my breath. If we have heard the last of their ideas on redistributing capital, who is there left for a EU sceptic to vote for?