It is also a little weird to describe the money as "unearned". In the hand of the beneficiary, maybe. But it'll be taxed afterwards if they buy a car or whatever won't it? So the Govt. will get its pound of flesh in the end.
In the case of those of us living in London and the South East a fair chunk of it's also likely to be unearned by the person leaving the estate as well, simply due to benefitting from the effects of house price inflation. And if you sell shares and make a capital gain on them you still have to pay Capital Gains Tax right, even if you're going to be paying VAT on the car you buy afterwards, aren't you? So why should being fortunate enough to receive unearned income in a different way be completely exempt?
In any event, over the lifetime of the deceased, the chances are that the inheritance is just the rump of the money earned which has already been, taxed, taxed and taxed again. (Income tax, NICS, stamp duty, property taxes, VAT, CGT, dividend tax or whatever.) Anyone that has managed to get to the end of their life and still managed to have some money left over after a lifetime of watching successive Governments flush most of it down the toilet on pet projects and then having to pay for their care in their last moments deserves to have that money passed on free of yet another tax in my opinion.
Oh man, don't get me started on care fees, I'll be ranting all week! While I get as pissed off as anyone with some of the ridiculous things the Government wastes tax money on, the fact is that tax is what pays for the infrastructure and organisations that will maintain the civilised society that your beneficiaries are going to be living in. If you don't want them to be taxed on the money you leave, then those taxes are going to have to come from somewhere else. Increase VAT? Hits those on lower incomes hardest proportionately. Increase income tax? Could do, but it's argued that stifles ambition. Increase corporation tax? Claimed to drive companies off-shore, and probably somewhat academic as far as the Googles, Starbucks etc are concerned. Increased Capital Gains Tax? Could do, but I'm sure someone will find an argument against it.
I'm not saying that inheritance is morally wrong, just that those who are in a position to leave or inherit estates valued over the threshhold should recognise how incredibly lucky they are, rather than feeling hard done by about the inheritance tax.
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I'm not saying that inheritance is morally wrong, just that those who are in a position to leave or inherit estates valued over the threshhold should recognise how incredibly lucky they are, rather than feeling hard done by about the inheritance tax.