Inheritance tax (again)
There is the assumption, contrary to economic history and most current predictions, that house prices will just keep on booming and therefore make even the most modest of homes liable for inheritance tax. There is the allegation that the levy is a form of “double taxation” – well, so is VAT, and anyway, money earned on property is untaxed. There is the unlikely assumption that people will not downshift to a smaller place, or see their savings swallowed up paying for their own care in their old age – as Carl Emmerson, deputy director of the thinktank the Institute for Fiscal Studies, says: “Your wealth at 50 or 60, when it’s at its peak, will not be the same as your wealth when you’re 80 or 90.” You could even question the notion that inheritance tax can be called a “death tax” at all, when it is not paid by the unfortunate dead but by the fortunate living. Emmerson, who is studiedly neutral on the question of inheritance tax, runs through these arguments and counter-arguments and then pauses a little wearily. “Maybe it’s just a badly understood tax,” he says.