British somehow manage to live with estate taxes
By Lee Russ
Wednesday, August 09, 2006 at 03:49 PM
Given the apoplexy that right wingers display when the subject of estate taxes come up, I thought you might want a point of comparison when thinking about the U.S. tax which kicks in on estates over $2 million (with other exemptions available, and a zillion ways to dodge some or all of the tax).Here's a piece of U.K. estate tax news from a couple of days ago:
Inheritance tax hits 72% more Brits
Monday, 07 Aug 2006 08:37
The number of people paying inheritance tax has leapt 72 per cent in five years, according to Halifax.
Research for the bank, based on data from HM Revenue & Customs, reveals some 30,451 estates were liable for the tax in 2003/04 - 72 per cent more than five years previously.
The government estimates that 22 per cent more people are set to pay the tax by the end of this year.
"The steep increase in the number of estates paying inheritance tax highlights that the current inheritance tax threshold of £285,000 is too low," said Halifax economist Tim Crawford.
Inheritance tax is charged at 40 per cent of all assets passed on once the initial £285,000 exemption is used up.
But this figure has not kept pace with soaring house prices, seeing more and more people have their money heading to the Treasury rather than friends and families after they die.
The chancellor has said the threshold for the tax will climb to £310,000 in the next three years, but Halifax calculates that if it had kept pace with house prices the threshold would now stand at £430,000.
"Families with lower valued estates are paying an increased share of the total inheritance tax take whilst the super-rich are paying a smaller share," Mr Crawford noted.
"This trend is set to continue unless the government raises the threshold in line with house price inflation. We call on the government to raise the inheritance tax threshold to £430,000 to account for the increase in property prices over the past ten years."
To save you the math:
++A pound is worth about $1.91 today
++The current 285,000 pound threshhold = $544,000
++The suggested increase to 430,000 pounds would = $821,000
++The currently planned increase to 310,000 pounds = $592,000.
Sounds to me like a whole lot more rich Brits pay estate tax than rich Americans do. Sounds like even the attempt to revamp the U.K. system will leave it a lot more severe than the current U.S. system.
What the rich Brits need is the help of some of our crazier right wingers. Maybe we can export a boatload or two to the U.K., fully armed with microphones, signs bemoaning the "death tax" despite the fact that the vast majority of dead people don't pay it, and that wild-eyed look of indignation that the rest of us poor slobs just don't appreciate the specialness of the rich.
I'll kick in at least $50 toward the cost of shipping the loons out.