In re: Death tax sounds so morbid

This semester one of the classes I am taking is Wills, Trusts & Estates, which so far has been real interesting and presented some policy issues that I hadn’t really thought about before.  As you may know there has been a debate over estate taxes (and also inheritance taxes although the two are different, as one is upon the estate/executor) in any event under the current structure only the very rich actually pay any inheritance tax, yet still a fuss is raised.

In our text the issue was brought up early on in a series of articles if we should have any tax, no tax, or some extreme tax.  The logic for not allowing inheritance and instead sending the money to the state was compelling for a number of reasons, mostly that it seems perverse to have some people better off simply because of birth in a democratic society.  That said there are plenty of counter arguments, including the fact that many people work hard knowing that they will be able to leave their wealth to their family and to take care of them.  No one can deny though that as people live longer no one grows up expecting to use their inheritance, as by the time someones parents are elderly they themselves have reached their prime earnings potential and are likely self-sufficient.  In fact one of the articles argued that today the important parent to child transfers are occurring inter vivos earlier in life with the payment for education and the like.

Of course we would never set up a 100% inheritence tax (in fact were moving towards a zero percent tax for one year, before we revert to the old one) but there is something to be argued for taxing the dead, of course death tax sounds so horrible, and makes for a sound bite, but common, wouldn’t you rather be taxed after you dead, then while your alive?

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One Response

  1. I’d rather that I and everyone else be taxed at a 50-60% rate while we are alive. Viva Socialism!

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