/ Inheritance tax - Is it wrong?

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Oliiver - on 19 Nov 2013
I'm only after a simple response . Should inheritance tax be abolished or, should the untaxed limit be changed?
twm.bwen - on 19 Nov 2013
In reply to Oliiver: in the style of Louis Walsh, you remind me of a young Franco cookson. Of course it shouldn't be abolished.
Next question?
balmybaldwin - on 19 Nov 2013
In reply to Oliiver:


A reasonable question, afterall, the money has already been taxed once.

However, I think it is necessary and fairish, but the level should be raised such as a modest house (3-4 bed) does not incur the tax and force people out of their parental homes.
alasdair19 on 19 Nov 2013
In reply to balmybaldwin: tax has to happen. The very rich have accountants so no often money has not been taxed. so we as a society tax peoples work or their silver spoons?
IainRUK - on 19 Nov 2013
In reply to Oliiver: I think we need to get rid of inheritance..
Dan Arkle - on 19 Nov 2013
It is the fairest tax there is. You don't need any money when you're dead, and any left to your children will help them in a way that is absolutely unfair on those without such an advantage. For example, a hardworking family in the south east may never be able to buy a house as the property market is so skewed by inherited wealth.

Obviously I understand people want the best for their children, but high inheritance tax would create an overall fairer and equal society, which is better for everyone's happiness.
The New NickB - on 19 Nov 2013
In reply to balmybaldwin:
> (In reply to Oliiver)
>
>
> A reasonable question, afterall, the money has already been taxed once.
>
> However, I think it is necessary and fairish, but the level should be raised such as a modest house (3-4 bed) does not incur the tax and force people out of their parental homes.

In most of the country it doesn't.
Dr.S at work - on 19 Nov 2013
In reply to IainRUK:
> (In reply to Oliiver) I think we need to get rid of inheritance..
And heritability?
999thAndy on 19 Nov 2013
In reply to Dan Arkle:
>
> Obviously I understand people want the best for their children, but high inheritance tax would create an overall fairer and equal society, which is better for everyone's happiness.

It won't make the losers happier. Just thought I'd point that out.
FesteringSore - on 19 Nov 2013
In reply to alasdair19: By today's standards one doesn't have to be very rich to get clobbered by IHT. It is a tax that arises as a result of people having saved and invested their money carefully and wisely instead of smoking it and pissing it up against the wall.
Tony the Blade on 19 Nov 2013
In reply to IainRUK:
> (In reply to Oliiver) I think we need to get rid of inheritance..

Really? So if I'm careful with my money and spend wisely and prudently and die unexpectedly then my son shouldn't get my savings? I don't mind him paying tax on it, but to take it from him entirely just isn't fair.
Dr.S at work - on 19 Nov 2013
In reply to FesteringSore:
to be fair though, smoking and drinking are one way we redistribute money, inheritance tax is another.
Bob Hughes - on 19 Nov 2013
In reply to 999thAndy:

In a sense it could in that, in an ideal world, you would either reduce tax on something else or pay for better services.

Clint86 - on 19 Nov 2013
In reply to Tony the Blade: I could definitely be persuaded to abolish inheritance. The prudent family could obviously provide for and give money away during their lifetime, although there would have to be rules on this as there are now.
Postmanpat on 19 Nov 2013
In reply to Dan Arkle:
> It is the fairest tax there is. You don't need any money when you're dead, and any left to your children will help them in a way that is absolutely unfair on those without such an advantage. For example, a hardworking family in the south east may never be able to buy a house as the property market is so skewed by inherited wealth.
>
> Obviously I understand people want the best for their children, but high inheritance tax would create an overall fairer and equal society, which is better for everyone's happiness.

It would also imply that your possessions are not actually yours . They belong to the State that permits you to hold some of them them temporarily but not to dispose of them as you see fit.

Is this a healthy principle?
MG - on 19 Nov 2013
In reply to Postmanpat:
> (In reply to Dan Arkle)
> [...]
>
> It would also imply that your possessions are not actually yours . They belong to the State that permits you to hold some of them them temporarily but not to dispose of them as you see fit.


Alternatively, it implies that, since you are dead and no longer exist, you can't have any possessions. Therefore no one owns them and the logical thing is for the state should acquire them (as it does for other ownerless goods) rather than them being aribtrarily assigned to someone by accident of birth.

Most people are happy with something between these extremes.
Sir Chasm - on 19 Nov 2013
In reply to MG: Leaving property in a will is hardly arbitrarily assigning it.
Trangia - on 19 Nov 2013
In reply to Oliiver:

No because if it was abolished the income would simply have to come from some other form of taxation.

The beauty of inheritance tax is that is a death tax so that unlike most other taxes it doesn't directly take money from a living person.
MG - on 19 Nov 2013
In reply to Sir Chasm:
> (In reply to MG) Leaving property in a will is hardly arbitrarily assigning it.

That depends on whether you think dead people can own property.
Sir Chasm - on 19 Nov 2013
In reply to MG: No it doesn't, a live person assigned their property, when they die ownership passes to the inheritor.
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Postmanpat on 19 Nov 2013
In reply to MG:
> (In reply to Postmanpat)
> [...]
>
>
> Alternatively, it implies that, since you are dead and no longer exist, you can't have any possessions. Therefore no one owns them and the logical thing is for the state should acquire them (as it does for other ownerless goods) rather than them being aribtrarily assigned to someone by accident of birth.
>
It's only logical if you believe in some sort of restoration of of the feudal system whereby the State owns everything and that this principle overrides the rights of people to own and dispose of property as they wish. It assumes that random seizure of assets by the State is for some reason superior to maintaining them as private property.

Bjartur i Sumarhus on 19 Nov 2013
In reply to Oliiver: If you have some assets and are retired but healthy, it can make a lot of sense to start gifting your estate to your children/grand children (if you wish). You need to live for another 7 years. Having said that, I can imagine some awkward conversations between savvy kids and ignorant parents ;-)
MG - on 19 Nov 2013
In reply to Postmanpat:

overrides the rights of *dead* people to own and dispose of property as they wish.

You missed a word. Viewed objectively, allowing the dead to own things is a bit odd I would say. Of course the way society is setup we do generally allow them certain rights over their former property after they are dead and changing this would be difficult and proabably pointless.. The position we have seems about right to me - a married couple have somethign like a £650k allowance before death duties kick in.

Postmanpat on 19 Nov 2013
In reply to MG:
> (In reply to Postmanpat)
>
> overrides the rights of *dead* people to own and dispose of property as they wish.
>
> You missed a word. Viewed objectively, allowing the dead to own things is a bit odd I would say. Of course the way society is setup we do generally allow them certain rights over their former property after they are dead and changing this would be difficult and proabably pointless.. The position we have seems about right to me - a married couple have somethign like a £650k allowance before death duties kick in.

It is the live person who orders the disposal. Anyway, you are still assuming a default position that the State has rights to property denied to related or other individuals or to private entities.

999thAndy on 19 Nov 2013
In reply to Bob Hughes:
> (In reply to 999thAndy)
>
> In a sense it could in that, in an ideal world, you would either reduce tax on something else or pay for better services.

<wry smile>
MG - on 19 Nov 2013
In reply to Postmanpat:

Anyway, you are still assuming a default position that the State has rights to property denied to related or other individuals or to private entities.

The state as in "society". But yes I am questioning why simply being genetically attached to someone who died gives you any particular claim over what they owned, and why that someone should be able to chose who acquires it from beyond the grave. That strikes me as much more "feudal" than simply dividing the property up equally amongst everyone. That said of course, it is the system we have and is very deeply engrained in society - I would be very disappointed if I didn't inherit some stuff and the state grabbed it instead.
Owen W-G - on 19 Nov 2013
In reply to Dan Arkle:

> You don't need any money when you're dead, and any left to your children will help them in a way that is absolutely unfair on those without such an advantage.

Isn't the attempt to give your children an advantage in their lives a fundamental part of human nature?

Personally, I'm all in favour of my kids taking my hard earned money rather than the state. If inheritance tax was switched today to 100% all the proceeds would simply be swallowed into the black hole of debt. No one would benefit.

Besides, with 100% death tax you'd see people burn their cash on their death beds rather than giving it to the state.
The New NickB - on 19 Nov 2013
In reply to Oliiver:

In time, hopefully a long time, I am likely to benefit from from two inheritances that will attract inheritance tax, one probably a small amount the other probably considerable. I have no problem with paying tax on either, in each case we will have to sell some or all of the properties as I have siblings, I also hope that substantial sums are gifted to charity. It is not money I have earn't and it probably won't come at a time in my life when I particularly need it.
The New NickB - on 19 Nov 2013
In reply to Owen W-G:

Burning cash is good, the state can print cash to replace it without causing inflation.
Choss on 19 Nov 2013
In reply to Oliiver:

The few Times ive been Left a Drink by folk, ive always told the executor to Donate the money direct to the PDSA.

The Thought of gaining Financially From someones Death, Especially parents etc, is just Alien to me. I couldnt do it.

Postmanpat on 19 Nov 2013
In reply to MG:
> (In reply to Postmanpat)
>
> Anyway, you are still assuming a default position that the State has rights to property denied to related or other individuals or to private entities.
>
> The state as in "society". But yes I am questioning why simply being genetically attached to someone who died gives you any particular claim over what they owned, and why that someone should be able to chose who acquires it from beyond the grave.

Because private property rights and the family as a building block of society are important to a democratic liberal society. It is not coincidence that left wing dictatorships make it their business to undermine both.
MG - on 19 Nov 2013
In reply to Postmanpat:
> (In reply to MG)
> [...]
>
the family as a building block of society are important to a democratic liberal society. It is not coincidence that left wing dictatorships make it their business to undermine both.

That's probably correct but it's not the answer normally given when people try and defend the case against death duties.
DancingOnRock - on 19 Nov 2013
In reply to Oliiver:

In my view of life your purpose is to pass on successful genes. This is heredity at its most basic. The most healthy and best suited prosper. We all want our genes to be passed on.

For a government to undo all that you have done to create the best opportunity and environment is unjust. But there has to be a break even point where those that can, help those that have been disadvantaged through no fault of their own. For he greater good of society.

In the main that is what TAX does. However on the minority are people who will disatvantage themselves in order to benifit from handouts.

In an ideal world there would be no TAX and we would all be able to afford to pay for the services as we use them.

The TAX system is too complicated because like the NHS we're trying to provide too many services that should be paid for by the individuals what actually use them and can/could afford to pay for them.
Bjartur i Sumarhus on 19 Nov 2013
In reply to Choss: If your parents died and left you a house (for example) you would sell it and donate the lot to the PDSA?
Andrew Lodge - on 19 Nov 2013
In reply to Oliiver: Of course it should be abolished, it is the most unfair tax possible, assuming the estate is not the proceeds of crime it should be the absolute right of the owner of the estate to gift it to whoever they wish. The state should have nothing to do with it.

In effect all it means for most people is they have to pay accountants to work through the ridiculously complicated tax system we have to mitigate it, much easier to scrap it altogether as the amount raised is actually very small.
Abolishing IHT should be part of a major reform of our tax system, a single rate of income tax that doesn't start until something approaching the minimum wage.

In a sensible taxation system almost everyone should be able to fill in a tax return on the back of a postcard rather than the piles of forms we have now.
jkarran - on 19 Nov 2013
In reply to DancingOnRock:

> The TAX system is too complicated because like the NHS we're trying to provide too many services that should be paid for by the individuals what actually use them and can/could afford to pay for them.

Which services specifically that the state currently provides should only be available to those with independent means to pay?

jk
Sir Chasm - on 19 Nov 2013
In reply to Andrew Lodge: Fair enough, we'll abolish inheritance tax and merely tax the recipients of the funds as we would tax any other income.
Choss on 19 Nov 2013
In reply to Bjartur i Sumarhus:
> (In reply to Choss) If your parents died and left you a house (for example) you would sell it and donate the lot to the PDSA?

oh yes.

Is that hard to believe?

gran died. mum died. didnt Take a Penny From either.

Father instructed not to Leave me anything.
Trangia - on 19 Nov 2013
In reply to Choss:

If the estate exceeds £360,000 isn't the excess still subject to IT even if it's donated to Charity?
Choss on 19 Nov 2013
In reply to Trangia:

That Kind of figure has never applied to anyone in my family.
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blurty - on 19 Nov 2013
In reply to Choss:

I salute you. (no irony)
Bjartur i Sumarhus on 19 Nov 2013
In reply to Choss: Hard to believe? Well, it seems incredibly principled bordering on smelling a bit whiffy / unhinged considering you posted this the other day

"I havent worked for 20 years, and only get 160 notes a week plus rent council tax and all NHS."

But I shouldn't judge. Domestic pet gods obviously work in mysterious ways ;-)

ByEek - on 19 Nov 2013
In reply to Andrew Lodge:
> (In reply to Oliiver) Of course it should be abolished, it is the most unfair tax possible, assuming the estate is not the proceeds of crime it should be the absolute right of the owner of the estate to gift it to whoever they wish. The state should have nothing to do with it.

It is a tough one. On the one hand you make a fair point. But on the other, inheritance tax (if it worked) is a good leveller ensuring that families don't keep amassing vast land wealth. Of course in reality this doesn't work anyway for the super rich who avoid inheritance tax in many ways. That said, it has the same moral undertones as those who complain about having to sell their houses to pay for long term elderly care.
Coel Hellier - on 19 Nov 2013
In reply to Oliiver:

The trouble with inheritance tax is that it is set at a high rate that encourages people to find ways round it, and indeed there are ways round it.

We should set it at a lower level, say 15% or 18%, but abolish the ways round it, and reduce the threshold to, say, 50k. You'd probably get as much tax take, but it would be perceived as much fairer. Good taxation policy is a little on everything, to minimise distortions.
Trangia - on 19 Nov 2013
In reply to Choss:

In that case your previous post is irrelevant to what is being discussed isn't it? :)
Choss on 19 Nov 2013
In reply to Bjartur i Sumarhus:

A bit Whiffy?

I wouldnt worry about what i say to wind young master Oliver up.

Unhinged, very possibly?

From my mother i got a Compassion and Concern for people.

From my Father i Inherited a love of the Natural world, and compassion to, and the Value of all animals.

Ill Take Those over a rich Kids money everyTime. Thats the Problem, with what people actually value. I have never rated Money that highly, and to Take it From a Dead persons Hand would appal me. I would feel Like the Lowest snake i could.

always to PDSA. They Enable poor people who couldnt Otherwise afford the vet care Keep their animal companions Healthy. Helps animals, and vastly improves the Lives of poor people, with all the positive Life Enhancing benefits pets bring into a Life. I think my mum and gran would have approved.

(Oh. I also inherited my luxuriant blonde hair, and stunning electric blue eyes)


Postmanpat on 19 Nov 2013
In reply to Coel Hellier:
> (In reply to Oliiver)
>

>
> We should set it at a lower level, say 15% or 18%, but abolish the ways round it, and reduce the threshold to, say, 50k. You'd probably get as much tax take, but it would be perceived as much fairer. Good taxation policy is a little on everything, to minimise distortions.

You'd also be imposing it on pretty much every house owner in the country and thereby never win an election again!

Sir Chasm - on 19 Nov 2013
In reply to Choss: Is it just that they're dead? Would you take a gift from a live person?
Choss on 19 Nov 2013
In reply to Sir Chasm:
> (In reply to Choss) Is it just that they're dead? Would you take a gift from a live person?

Yes, why not?


Sir Chasm - on 19 Nov 2013
In reply to Choss: So you'd take £50 from a live person, but if that person left you £50 in their will you wouldn't take it? What's the difference?
Coel Hellier - on 19 Nov 2013
In reply to Postmanpat:

> You'd also be imposing it on pretty much every house owner in the country and thereby never win an election again!

That might be so, but the "house owner" only pays when dead. What you'd really be taxing is the windfall legacies to middle-aged, middle-class people whose parents owned homes. Why would taxing that at a rate of 15% be so bad? People getting such legacies are usually doing ok financially, and a 15% reduction still leaves them with most of it. If those people were getting the same in pay or capital gains they'd pay much more tax on it. As I said above, a little on everything, a modest tax rate whenever money changes hands, is the best policy.

I do realise, though, that I'm out of line with most people on this, who regard homes as sacrosanct. I've never seen anything wrong with elderly people being expected to sell their homes to fund going into a care home, since at that point they no longer need or use their home. It seems bonkers to me that it should be a national priority to provide state funding to ensure that this doesn't happen, and thus that the middle-aged, middle-class lucky ones get their windfall legacies.

To me, national priority for state funding are the families who are less well off than that, plus education, health etc. Ensuring that the middle-aged, middle-class lucky ones get their windfall legacies is way down my priority list for government spending.

[By the way, I myself am in the latter group, who may one day get a chunk of a parental home which is valued at over the threshold, but I certainly don't regard myself as any sort of priority for government subsidy.]
Choss on 19 Nov 2013
In reply to Sir Chasm:

It would just feel wrong to me.

Next door neighbour died Several weeks ago. she had divied up all her stuff before she went. Knowing i like a Drink she Left 30 notes for her widower to give me to have a Drink on her after shed passed. I couldnt Take it, could you?
Sir Chasm - on 19 Nov 2013
In reply to Choss: Of course, if that was what the dead person had wanted. To not accept would be to throw the gift back in their face.
dsh - on 19 Nov 2013
In reply to Oliiver:

Good news everyone. Gifts to political parties are exempt from inheritance tax!
Wiley Coyote - on 19 Nov 2013
In reply to Oliiver:

All this 'soak the rich' and redistribute their 'vast estates' does conveniently overlook the fact that they are the very ones who don't pay Inheritance Tax because they are the ones with the good accountants. Although of course you don't have to be rich to do it. My buidlng society is always asking me about 'Inheritance Planning' by which they mean fast financial footwork to avoid tax.
Having just checked my pulse I discover that I am, miraculously, still alive and I have also made a will. It seems to me perfectly reasonable that I should be able to give my property to whoever I like rather than George Osborne confiscate it to pay for another of his grandiose schemes or, worse still, Ed Balls, blow it on some failed IT system. Assorted governments has wasted quite enough of my money already, thank you,
As a side issue I would abolish rights of inheritance (ie a right for anyone to automaticaly claim my stuff) but stabnc hly support a right of bequest (ie my right to give it to whoever I please regardless of birth etc).
Coel Hellier - on 19 Nov 2013
In reply to Wiley Coyote:

> It seems to me perfectly reasonable that I should be able to give my property to whoever I like
> rather than George Osborne confiscate it ...

By the same token, it would be perfectly reasonable for you to give a chunk of your wealth to a local builder in return for him building you a conservatory or replacing your windows.

However, that money-changing-hands transaction would attract VAT and the recipient would also pay income tax on it. This sort of thing needs to happen if we're to have schools, hospitals, a welfare state, etc.

By the same token, therefore, it's entirely reasonable for the tax man to take a chunk of any money/property that you bequest to someone.
DancingOnRock - on 19 Nov 2013
I love the way that middle aged, middle class people are somehow lucky.

There's me thinking I studied hard and worked hard to earn my money when in reality all I did was sit on the dole until I won the lottery. Excellent. Everyone should try it.
Postmanpat on 19 Nov 2013
In reply to Choss:
> (In reply to Sir Chasm)

> Next door neighbour died Several weeks ago. she had divied up all her stuff before she went. Knowing i like a Drink she Left 30 notes for her widower to give me to have a Drink on her after shed passed. I couldnt Take it, could you?

Why are you happy to accept donations via the State from people you don't know and quite possibly would rather not make them, but unhappy to accept a donation from somebody you knew who specifically wanted to give it to you?

Postmanpat on 19 Nov 2013
In reply to Coel Hellier:
> (In reply to Postmanpat)
>
> [...]
>
> That might be so, but the "house owner" only pays when dead. What you'd really be taxing is the windfall legacies to middle-aged, middle-class people whose parents owned homes.
>
Well, I don't think only the middle class (depending on your definition) own property worth £50k.

IHT is the classic case of a tax that is popular with those who don't have to pay it and would be very unpopular were it to embrace a large part of the population. It is therefore impossible to introduce at a low threshold. The trick. of course, is to leave the threshold where it is and wait for inflation to make it capture a large part of the population, which is what is happening now......

The New NickB - on 19 Nov 2013
In reply to DancingOnRock:
> I love the way that middle aged, middle class people are somehow lucky.
>
> There's me thinking I studied hard and worked hard to earn my money when in reality all I did was sit on the dole until I won the lottery. Excellent. Everyone should try it.

Yet so ignorant. I have been very lucky, supportive family, money never a major worry. Sure I've studied and worked hard, but it would have been a hell of a lot harder without the opportunities provided by luck of birth. Don't take my word for it though, plenty of research to show that household income at the age of two is the biggest determinant of success in life, looking at income related measures, but also health and other softer measures.
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Choss on 19 Nov 2013
In reply to Postmanpat:

Im Sorry. I didnt realise i was Taking donations From the state? Thats very benefit recipient phobic of you.

I am claiming what i am entitled to, after being very Thoroughly assessed by the govt and its Private sector partners Several Times.

In fact i UnderClaimed for a Long Time Until my Social worker helped me get my True entitlement.

You Sound like you resent people claiming their entitlement? Lets hope you never need them then.

Quick reality check. Biggest portion of Welfare goes on pensioners, even the millionaires. Second Largest slice goes on in work benefits, so that tax money is being Used to allow the monied class to get away with paying Shit wages. The smallest chunk goes on out of work benefits. Many of these are sickness related. Which you seem to object to.



Trangia - on 19 Nov 2013
In reply to Choss:
> (In reply to Sir Chasm)
>
> It would just feel wrong to me.
>
> Knowing i like a Drink she Left 30 notes for her widower to give me to have a Drink on her after shed passed. I couldnt Take it, could you?


Why on earth not? It's what she wanted to do and was a lovely thought on her part, to refuse it would be an insult to her memory and very insensitive to her widower's feelings.


Choss on 19 Nov 2013
In reply to Trangia:

Its just not Something i am comfortable with.
Coel Hellier - on 19 Nov 2013
In reply to DancingOnRock:

> I love the way that middle aged, middle class people are somehow lucky. There's me thinking I studied
> hard and worked hard to earn my money when in reality all I did was sit on the dole until I won the
> lottery. Excellent. Everyone should try it.

Well, actually, the word "lucky" as I used it applied not to being middle class or to being financially secure, but to getting a big legacy from ones parents owning a house and passing it on at their death.

How wealthy your parents are is indeed -- from your point of view -- largely a matter of luck of which family you are born into. It is not something that you've earned by your own merit. This is why a sensible inheritance tax is, it seems to me, appropriate.
Coel Hellier - on 19 Nov 2013
In reply to Choss:

> Im Sorry. I didnt realise i was Taking donations From the state? [...] I am claiming what i am entitled to ...

Well, you are indeed taking donations from the state. The fact that the state has decided to allow you these donations (aka stated that you are "entitled" to them) doesn't change that.
Postmanpat on 19 Nov 2013
In reply to Choss:
> (In reply to Postmanpat)
>

>
> You Sound like you resent people claiming their entitlement? Lets hope you never need them then.
>
Not at all, but you are at least as entitled to the money someone specifically wanted to give to you. What is the difference?

> Which you seem to object to.

No, you are making an assumption on the basis not of what is said but of you think is said.

I'm interested as to why you see one a OK but not the other, like I said.

Personally I think it's good for society a a whole if some money is redistributed from those who have it to those who, through no fault of their own, need it. I also think it's good for society if people can give money to who they choose when they choose and cannot see why one would think doing the latter or accepting the latter worse than the former
Coel Hellier - on 19 Nov 2013
In reply to Postmanpat:

> Well, I don't think only the middle class (depending on your definition) own property worth £50k.

Wouldn't you? I would indeed say that owning 50k assets makes you "middle class" in a broad sense. Certainly by the original meaning of "working class" it does (i.e. people living in rented accommodation, using up their pay packet each month with little or no savings or assets). 50k is equivalent to about 5 years of minimum-wage employment.
Choss on 19 Nov 2013
In reply to Coel Hellier:

I would Love to Know how many people have Turned down their state donations/entitlements to child benefit, tax credits, SSP, pension, out of work benefits, bus pass, Heating allowance, and all Other aspects of the welfare system?

Not many, ill wager.

Its just Become Acceptable to Criticise people on out of work benefits hasnt it? Ok for the super rich to swallow child benefit for no reason, but people in wheelchairs are getting Spat on in the street.
DancingOnRock - on 19 Nov 2013
In reply to Coel Hellier:
> (In reply to DancingOnRock)
>
> [...]
>
> Well, actually, the word "lucky" as I used it applied not to being middle class or to being financially secure, but to getting a big legacy from ones parents owning a house and passing it on at their death.
>
> How wealthy your parents are is indeed -- from your point of view -- largely a matter of luck of which family you are born into. It is not something that you've earned by your own merit. This is why a sensible inheritance tax is, it seems to me, appropriate.

Rubbish. I'm not 'lucky' to be born to my parents. That's some backward thinking there. My parents planned and gave birth to me, I didn't chose which family to be born to and just happened to pick a wealthy one.

And what makes you think my parents were wealthy and middle class?
Trangia - on 19 Nov 2013
In reply to Choss:

I see where you are coming from but the psychology of death is complex, and you need to consider the widower's feelings here. If my wife had gone to the trouble of tasking me as her widower to perform a specific duty after her death I would want to see it through and I would feel unhappy if the recipient tried to second guess her motive. She obviously wanted you to have the money, and to refuse seems ungracious.

Anyway that's how I feel in answer to your original question.
DancingOnRock - on 19 Nov 2013
In reply to Trangia: regardless of how Choss sees it. He was given the money and accepted it. If he didn't want it he could have contested the will and tried to have the PDSA named as a be beneficiary. I doubt that he would have succeeded.

As it is he accepted the money and then did what HE wanted with it.

It's quite ironic really that he is arguing differently.
Postmanpat on 19 Nov 2013
In reply to Coel Hellier:
> (In reply to Postmanpat)
>
> [...]
>
> Wouldn't you? I would indeed say that owning 50k assets makes you "middle class" in a broad sense. Certainly by the original meaning of "working class" it does (i.e. people living in rented accommodation, using up their pay packet each month with little or no savings or assets). 50k is equivalent to about 5 years of minimum-wage employment.
>
No. Is this one of self invented "definitions" made up to suport your argument? :-)

There is no definition of "working class" or "middle class" Is a manual worker who bought their council house not working class?

66% of households live in owner occupied accommodation but 60% of people regard themselves as "working class" so the two things cannot be mutually exclusive.

IainRUK - on 19 Nov 2013
In reply to Tony the Blade:
> (In reply to IainRUK)
> [...]
>
> Really? So if I'm careful with my money and spend wisely and prudently and die unexpectedly then my son shouldn't get my savings? I don't mind him paying tax on it, but to take it from him entirely just isn't fair.

FFS of course I'm joking... I thought it was make outlandish uninformed statements on UKC week..
IainRUK - on 19 Nov 2013
In reply to Wiley Coyote:
> (In reply to Oliiver)
>
> All this 'soak the rich' and redistribute their 'vast estates' does conveniently overlook the fact that they are the very ones who don't pay Inheritance Tax because they are the ones with the good accountants

Exactly, anyone with money will be redistributing it anyway as it is..
DancingOnRock - on 19 Nov 2013
In reply to Postmanpat:

It's a way of thinking and behaving. Even millionaires can be working class.

Sad really that we have to pidgeonhole ourselves.

There's an awful lot of inverse snobbery goes on.
stevieb - on 19 Nov 2013
In reply to Oliiver:
Tax has to come from somewhere. Why is it more acceptable to tax income or spending than to tax wealth?
Personally, I think Inheritance tax is clumsy, and above the threshold the rate seems too high, but I also think wealth taxes contribute far too little as a proportion of total tax.
A general land tax would be far harder for the super wealthy to avoid than inheritance tax, stamp duty and council tax are.
Coel Hellier - on 19 Nov 2013
In reply to DancingOnRock:

> My parents planned and gave birth to me, I didn't chose which family to be born to and just happened to pick a wealthy one.

From the child's point of view it is entirely luck which family they find themselves born into. That was my point.

> And what makes you think my parents were wealthy and middle class?

I didn't say that. I was using "your" in the general sense of people in general. As I said, whether someone has wealthy parents who leave them large legacies is -- from their point of view -- a matter of luck, not a matter of their earning it.
Coel Hellier - on 19 Nov 2013
In reply to Postmanpat:

> Is a manual worker who bought their council house not working class?

Not any more.

> 66% of households live in owner occupied accommodation but 60% of people regard themselves as "working class"
> so the two things cannot be mutually exclusive.

Where is the latter statistic from? I'm rather surprised by it. Once you become a property owner with assets that, to me, makes you "middle class". It certainly would have by the standards of when the terms were invented.
Postmanpat on 19 Nov 2013
In reply to Coel Hellier:
> (In reply to Postmanpat)
>
>
> Where is the latter statistic from? I'm rather surprised by it. Once you become a property owner with assets that, to me, makes you "middle class". It certainly would have by the standards of when the terms were invented.

British Social Attitudes survey from the National Centre for Social Research

A bit old (2007) but doubt it's changed much.

DancingOnRock - on 19 Nov 2013
In reply to stevieb:
> (In reply to Oliiver)
> Tax has to come from somewhere. Why is it more acceptable to tax income or spending than to tax wealth?
> Personally, I think Inheritance tax is clumsy, and above the threshold the rate seems too high, but I also think wealth taxes contribute far too little as a proportion of total tax.
> A general land tax would be far harder for the super wealthy to avoid than inheritance tax, stamp duty and council tax are.

Because people adapt their spending according to their budget which includes their tax burden.

Is it right to tax an old lady living in her house on a state pension after she has worked and saved all her life?

It's a clumsy tax and set at a point where you could buy a reasonable size house in any part of the country. It was raised by Labour as Conservatives had let it become reduced by inflation and house price increases. It only affects most people once or maybe twice in their lives.

£600k would attract £110k tax which would be payable over 10years if it was in property. Doesn't sound a huge amount to benefit from a £600k house considering you'll have to be able to afford the general bills and running costs of a £600k house and would have no other mortgage.
Ramblin dave - on 19 Nov 2013
In reply to Postmanpat:

> IHT is the classic case of a tax that is popular with those who don't have to pay it and would be very unpopular were it to embrace a large part of the population.

Although it's interesting that objections to it almost always seem to be phrased from the point of view of the legator rather than the legatee - it's all about "I should be able decide what happens to my property after I die without government interference" not "I don't want the £500,000 windfall I get when my parents cop it to turn into a £450,000 windfall."

I suspect that when my parents finally do shuffle off this mortal coil (which hopefully won't be for some time) then assuming that they haven't sold the house and run off to Vegas in the interim, myself and my sister will end up paying a decent amount of inheritance tax. This doesn't seem unreasonable at all to me, since we're both grown-ups and happily making our own way in the world.

DancingOnRock - on 19 Nov 2013
In reply to Coel Hellier:
> (In reply to DancingOnRock)
>
> [...]
>
> From the child's point of view it is entirely luck which family they find themselves born into. That was my point.
>
> [...]
>

As I say it's not luck. Your birth is a direct result of someone's descision.

Unless of course you ignore Darwin and become a Bhudist.

DancingOnRock - on 19 Nov 2013
In reply to Oliiver:

I just can't understand why anyone would spend their whole life nurturing children and giving them every opportunity that they can to assist them and put them in the best position to carry on your genes. Then not give them any further financial help after you die.

Maybe this is the difference between 'middle' and 'working' class thinking and why the middle classes seem to do better. It's certainly not luck that I sit down with my kids, read to them, explain things to them, help them with their homework, ensure they have a large wide network of friends and countless other things.
Coel Hellier - on 19 Nov 2013
In reply to DancingOnRock:

>> From the child's point of view it is entirely luck which family they find themselves born into. That was my point.

> As I say it's not luck. Your birth is a direct result of someone's descision.

Are you being wilfully perverse? As I said: FROM THE CHILD'S POINT OF VIEW it is entirely luck which family they find themselves born into. The fact that it arises from SOMEONE ELSE'S DECISION (namely that of their parents) is entirely the point. It is not owing to THE CHILD'S actions or THE CHILD'S merit which family a child finds themselves in.

Oxford Dictionaries: "luck": "success or failure apparently brought by chance RATHER THAN THOUGH ONE'S OWN ACTIONS". (Added capitals.)
Tony the Blade on 19 Nov 2013
In reply to IainRUK:
> (In reply to Tony the Blade)
> [...]
>
> FFS of course I'm joking... I thought it was make outlandish uninformed statements on UKC week..

oh shit, I'm sorry Iain, I didn't pick up on that. I thought it was a strange thing for you to say. :-)
IainRUK - on 19 Nov 2013
In reply to Tony the Blade: No I was fishing for Olii... he makes me laugh and I was bored.. :-)
wintertree - on 19 Nov 2013
In reply to Coel Hellier:

> FROM THE CHILD'S POINT OF VIEW it is entirely luck which family they find themselves born into.

Utterly tangential but not actually true, I believe. Statistically you are more likely to be born by a mother who has more children, so if some sections of society tend to breed more, the child is more likely to be born into it. I suspect this actually means that children are quite unlucky in terms of where they are born.
stevieb - on 19 Nov 2013
In reply to DancingOnRock:
Yes it's entirely right to tax the old lady, which is why we already do. She is taxed on spending, on council tax, on petrol, on gin and on pension income. Why are all of these acceptable, but taxing her on the size of her house is not?
Sir Chasm - on 19 Nov 2013
In reply to Choss: Perhaps you're right, perhaps all those things should be means tested (if it doesn't cost more), why should the "super rich" get child benefit? Equally, why should someone choosing to give away an inheritance expect the state to support them?
Choss on 19 Nov 2013
In reply to Sir Chasm:

Dont think that counts in my case. Can hardly be Accused of Squandering my inheritance on charitable donation.

There were only 2 inheritors. My sister and Myself. My share went to charity. It was £200. Even that would have gone to pay for my mums funeral, but her half sister coughed up for that.
Coel Hellier - on 19 Nov 2013
In reply to wintertree:

> Utterly tangential but not actually true, I believe.

But "luck" does not mean "equal chance" or "entirely random". For example, if you draw blindly from a bag containing 8 white balls and 2 black balls then it is "luck" which you get even though it is 4:1 that you get a white ball.
DancingOnRock - on 19 Nov 2013
In reply to Coel Hellier: It's not luck. You are born once to your parents. You are created by them. There is absolutely no way that you can be born to different parents or you wouldn't be you. It is a certainty that your parents are your parents. It's not like you're sitting around throwing a dice and just happen to be lucky and pick one set of parents out of a selection.

Luck implies that there was an alternative choice or outcome. There isn't.

Tony the Blade on 19 Nov 2013
In reply to DancingOnRock:
> (In reply to Coel Hellier) It's not luck. You are born once to your parents. You are created by them. There is absolutely no way that you can be born to different parents or you wouldn't be you. It is a certainty that your parents are your parents. It's not like you're sitting around throwing a dice and just happen to be lucky and pick one set of parents out of a selection.
>
> Luck implies that there was an alternative choice or outcome. There isn't.

Adoption?
Coel Hellier - on 19 Nov 2013
In reply to DancingOnRock:

> Luck implies that there was an alternative choice or outcome. There isn't.

Wrong, you are simply wrong. The word "luck" is about whether or not things are under *your* control, whether they came about through *your* efforts or designs.

I've already given you the definition from Oxford Dictionaries:
"luck" = "success or failure apparently brought by chance rather than through one’s own actions"
DancingOnRock - on 19 Nov 2013
In reply to Coel Hellier: 'apparently'
pork pie girl - on 19 Nov 2013
In reply to Oliiver: get rid of it.
DancingOnRock - on 19 Nov 2013
In reply to Choss:
> (In reply to Sir Chasm)
>
> Dont think that counts in my case. Can hardly be Accused of Squandering my inheritance on charitable donation.
>
> There were only 2 inheritors. My sister and Myself. My share went to charity. It was £200. Even that would have gone to pay for my mums funeral, but her half sister coughed up for that.

Funeral expenses are a legitamate expense from the estate. That £200 was effectively a gift to you from her half sister.

Choss on 19 Nov 2013
In reply to DancingOnRock:

And that Changes anything how?
davidbeynon - on 19 Nov 2013
In reply to Oliiver:

Inheritance tax is a major reason for the decline of the landed gentry. Whether or not you consider this a good thing is up to you, but personally I have no problem with it.

I will have no problem with paying it either - sure giving hypothetical offspring a start is good but there are plenty of ways to do that, and the taxman doesn't take everything.

DancingOnRock - on 19 Nov 2013
In reply to Choss: Well, it's not an inheritance.
ads.ukclimbing.com
Jimbo W on 19 Nov 2013
In reply to Oliiver:

No, it should be much higher and means tested. We should move to a system of custodianship of land / property, and not sequestration.
DancingOnRock - on 19 Nov 2013
In reply to Choss:

To clarify, the wording would have probably been to the effect that she wished you to have £200 or the balance of her savings etc. If there wasn't enough left even to pay the funeral expenses then there would have been no £200. So her half sister stepped in and paid the funeral expenses and the £200.

I've been executor of a couple of wills and it's a crazily difficult thing to do when things aren't straightforward. The wills I dealt with had to be changed a few times to be workable because the originals had been worded incorrectly and couldn't work.
Oliiver - on 19 Nov 2013
In reply to Oliiver: interesting debate, I'm amazed at the amount of pro inheritance tax people. Personally, I probably won't have to pay IT, due to the fact farmers / farms are exempt
stevieb - on 19 Nov 2013
In reply to Oliiver:
which tax are you in favour of?
MG - on 19 Nov 2013
In reply to Jimbo W:
> (In reply to Oliiver)
>
> No, it should be much higher and means tested.

Whos means?


We should move to a system of custodianship of land / property, and not sequestration.

Given we have (as a partial list) building regulations, planning law, SSSIs, National Parks, environmental legislation, various subsidies, access laws and extraction laws, don't you think we essentially have custodianship already? What further restrictions would you put in place? Why would anyone wish to be a custodian if further restrictions were in place?

Sir Chasm - on 19 Nov 2013
In reply to Jimbo W:
> (In reply to Oliiver)
>
> No, it should be much higher and means tested. We should move to a system of custodianship of land / property, and not sequestration.

How shall we decide what property we are custodians of? Can we pass on houses but not wealth?
JPSC - on 19 Nov 2013
In reply to Oliiver:

Of course it should be abolished, those receiving anything from a bequest should pay income tax on receipt. This would be fairer and simpler, one fewer tax to administer without losing the exchequer losing the income.
Ramblin dave - on 19 Nov 2013
In reply to davidbeynon:
> (In reply to Oliiver)
>

> I will have no problem with paying it either - sure giving hypothetical offspring a start is good but there are plenty of ways to do that, and the taxman doesn't take everything.

Also, a slightly bigger inheritance would very seldom be giving your offspring "a start", since the odds are that by the time you pass away your kids will be pushing into middle-age themselves. The stuff that gives your kids a start is the stuff that you do a lot earlier than that.

And yeah, for a sense of perspective here it's important to remember that currently the first £315,000 is tax free and anything else is taxed at 40%, so it's not like you can't leave your kids a biro without the taxman taking the ink.
IPPurewater on 19 Nov 2013
In reply to Oliiver: Are you a reincarnation of the young William Haig ?
Oliiver - on 19 Nov 2013
In reply to Oliiver: I think IT is a pointless tax. The only people It really affects is the middle classes
The New NickB - on 19 Nov 2013
In reply to Oliiver:
> (In reply to Oliiver) I think IT is a pointless tax. The only people It really affects is the middle classes

You could reduce you liability by buying a DELL rather than Apple.
The New NickB - on 19 Nov 2013
In reply to Oliiver:
> (In reply to Oliiver) I think IT is a pointless tax. The only people It really affects is the middle classes

More seriously, it has nothing to do with class, it is a tax on property, like most sensible taxes, it taxes people with money.
icnoble on 20 Nov 2013
In reply to Oliiver: My father died this summer. He was a consultant psychiatrist who officially retired at 65 but did bits of part time work into his 70's. He enjoyed his work and worked hard for the NHS. He made no money from private work. He retired on a good pension and had savings, enough not to be a burden on the state. I am dealing with his estate and my brother, sister and myself will be getting quite a nice inheritance, not life changing amounts. I don't know what my brother and sister will do with there inheritance, but mine will be added to the modest savings I already have so that my wife and I will not be a burden on the state as we get older. Wealthy people can afford accountants to mitigate inheritance tax, lucky them. For hardworking families like ourselves this tax is unfair. You work hard all your life, saving as you go along so that you can pay for your old age and the government tax it!!

My view is that the inheritance tax threshold should be substantially increased.
Coel Hellier - on 20 Nov 2013
In reply to icnoble:

> You work hard all your life, saving as you go along so that you can pay for your old age and the government tax it!!

The pedant in me feels compelled to point out that Inheritance Tax does not tax the money that *you* make by working hard, saving as you go along, for *your* old age -- though of course the government does do that through income tax, tax on interest on your savings, and tax on capital gains on your savings (of course you can bypass the tax by putting the money into a pension scheme, but then you lock up your money and pay tax on the resulting pension).

Given that, why should money bequeathed from your parents be different and be exempt from tax? As above, I'd argue that a much lower rate, no exemptions, and a low threshold are the best way. A little on everything should be the philosophy, maximising fairness and minimising distortions.

icnoble on 20 Nov 2013
In reply to Coel Hellier: So what do you think would be a fair level of inheritance tax?

Sam_in_Leeds - on 20 Nov 2013
In reply to Oliiver:

It's an "optional tax" in my opinion, anyone with half a brain knows there's more ways of getting round it than actually having to pay it.

But anyway, as most people's wealth is now from massive (untaxed) capital gains on property over the last 20 years Inheritance Tax is perhaps one of the fairer taxes IMO (Unlike VAT/Fuel Duty imo).

I'm a true-blue Tory btw.
Sam_in_Leeds - on 20 Nov 2013
In reply to Coel Hellier:
> (In reply to icnoble)
>
> [...]
> (of course you can bypass the tax by putting the money into a pension scheme, but then you lock up your money and pay tax on the resulting pension).

Or invest in smaller companies through Venture Capital Trusts or small AIM listed stocks etc
Coel Hellier - on 20 Nov 2013
In reply to icnoble:

> So what do you think would be a fair level of inheritance tax?

Above I suggested a rate of 15% to 18%, on everything above a low threshold of £50k, with no exemptions or ways round it.

So if a Dad leaves his 3 children 80k then approx 5k of tax is paid and the kids get 25k each. If a Dad leaves them £300k then about 45k is tax and the kids get about 83k each. If it's 30 million then that's about 4.5 million tax.
icnoble on 20 Nov 2013
In reply to Coel Hellier: That would seem to me to be a fair compromise
IainRUK - on 20 Nov 2013
In reply to Coel Hellier:
> (In reply to icnoble)
>
> [...]
>
> Above I suggested a rate of 15% to 18%, on everything above a low threshold of £50k, with no exemptions or ways round it.
>

How would you manage that? No gifts in the final decade of life?

Impossible to manage.

fedupandfat on 20 Nov 2013
In reply to Coel Hellier:
> (In reply to icnoble)
>
> [...]
>
> Above I suggested a rate of 15% to 18%, on everything above a low threshold of £50k, with no exemptions or ways round it.

Not even between husband and wife?
DancingOnRock - on 21 Nov 2013
In reply to fedupandfat:
> (In reply to Coel Hellier)
> [...]
>
> Not even between husband and wife?

That's not inheritance. A marriage is a legal partnership. Neither owns anything on their own legally, even if you appear to have separate accounts and appear to have your own money.

This is where it gets really tricky when someone remarries after their partner dies and then dies leaving children from a previous marriage. The new husband gets everything.
Coel Hellier - on 21 Nov 2013
In reply to IainRUK:

> No gifts in the final decade of life?

Yes.

> Impossible to manage.

The above is already the case: if a parent gives a gift, and then dies within seven years, then the gift is subject to inheritance tax.
MG - on 21 Nov 2013
In reply to Coel Hellier:
> (In reply to IainRUK)
>
> [...]
>
> Yes.
>
> [...]
>
> The above is already the case: if a parent gives a gift, and then dies within seven years, then the gift is subject to inheritance tax.

Which is tapered - this seems a resonable and pragmatic approach to me, whatever the details of the actual tax.

Neil Williams - on 21 Nov 2013
In reply to Coel Hellier:

The trouble with that is how do you plan for it? It could be a massive sum. This is also the difficulty with inheriting property - AIUI you have to pay the tax when you inherit even if you can't afford it at the time, not when the house is sold.

Would be better to tax gifts of a certain value whether "inherited" or not. Or just do away with it, which would be my preference. But I'm pro simplification - I would like to see (in principle) all taxes abolished other than income tax and vice taxes, and that would be at two rates (or ideally a flat rate) with a high personal allowance. Tax is, as the advert goes, way too taxing. It needn't be.

Neil
DancingOnRock - on 21 Nov 2013
In reply to Neil Williams: You can pay over 10years. As an example for a £600k property you would have to find £11k a year. I imagine most people could raise a 10year mortgage for £10-30k on the strength that you would pay off early as soon as the house was sold. Gives a bit of breathing space.
BelleVedere on 21 Nov 2013
In reply to 999thAndy:
> (In reply to Dan Arkle)
> [...]
>
> It won't make the losers happier. Just thought I'd point that out.

it might...

often you get more satisfaction frm things you've done yourself
DancingOnRock - on 21 Nov 2013
In reply to BelleVedere:
> (In reply to 999thAndy)
> [...]
>
> it might...
>
> often you get more satisfaction frm things you've done yourself

When I spoke to my mum before she died she said it was a shame that her grandchildren wouldn't get as much as she hoped and that so much would go in tax. It wasn't me(or even the kids) that was unhappy, it was her. But then she was about to lose more than money can buy.
myth - on 21 Nov 2013
In reply to Choss:
> (In reply to Sir Chasm)
>
> It would just feel wrong to me.
>
> Next door neighbour died Several weeks ago. she had divied up all her stuff before she went. Knowing i like a Drink she Left 30 notes for her widower to give me to have a Drink on her after shed passed. I couldnt Take it, could you?

Can't help thinking that the neighbour was made up that she could buy you a tipple after she died and that she would probably be a little disappointed that you turned her offer down.

Giving also gives people pleasure. To turn down someone's gift (even when dead) could be taken to be a little insults. That said they're dead so what do they know.

My 2p is that the Tax threshold is far too low for this day and age and the rate is far too high.

Some parents soul purpose in life is to give their child a financial head start and to have it taken from them seems a bit harsh.
Jim C - on 21 Nov 2013
In reply to Oliiver:
> I'm only after a simple response . Should inheritance tax be abolished or, should the untaxed limit be changed?

Yes abolish it, and abolish all the benefits for the poor at the same time, and watch the gap between the haves and the have nots widen even further. (We know that is what you want)

fedupandfat on 21 Nov 2013
In reply to DancingOnRock:
> (In reply to fedupandfat)
> [...]
>
> That's not inheritance. A marriage is a legal partnership. Neither owns anything on their own legally, even if you appear to have separate accounts and appear to have your own money.

HMRC states that there is a specific "Spouse and civil partner exemption", alongside "Charity exemption", "Annual exemption" and a few others. So, if Coel's "No exemptions" policy comes into force, inheritance tax would be payable between husband and wife (or civil partners).

http://www.hmrc.gov.uk/inheritancetax/intro/basics.htm#4

Sorry for the delay in replying, some of us have real jobs with real hours during the day.
Ramblin dave - on 21 Nov 2013
In reply to myth:
> (In reply to Choss)
> [...]

> Some parents soul purpose in life is to give their child a financial head start and to have it taken from them seems a bit harsh.

The first £325,000 is tax free - how much of a financial head start do you need?

Not to mention that most people won't be passing anything on until their kids are pushing into middle age themselves, so it's hardly a "start" in any case.
In reply to Dan Arkle:
Agree completely with this argument but please , am fed up with this Tory " hard working" cliche being bandied about!
Kemics - on 21 Nov 2013
In reply to Ramblin dave:

Very good point. Short of being orphaned (in which case I say give them the lot) who's actually helping their children? If you're middle aged and still relying on a last hand out from your parents maybe that's the kick up the arse you need ;)

My dad said to me at aged 10 "you realise son that you'll get nothing in inheritance...in fact I'm sort of counting on you helping me in my old age"

In theory I'd say tax the lot. But I also have a bit of problem of the state spaffing it away too
Coel Hellier - on 21 Nov 2013
In reply to fedupandfat:

> So, if Coel's "No exemptions" policy comes into force, inheritance tax would be payable between
> husband and wife (or civil partners).

Well no, I'd allow transfers to spouses without tax, but that's all. With a low rate (15 to 18%) you don't need exemptions since it is fair if people just pay it.
crossdressingrodney - on 21 Nov 2013
In reply to Oliiver: It's quite heartening that, by and large, opinions on this topic seem mostly motivated by altruism rather than the usual reaction to policy, which is to ask whether one will personally benefit.

Parents naturally want the best for their kids, even at the expense of everyone else's. But we beneficaries largely don't need hundred grand when we're forty, or hopefully sixty, and would be quite happy giving some up, as long as it's fair and the devious rich can't wriggle out of it.

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