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Inheritance taxes take wealth away from heirs, but unless there’s tremendous faith in the quality of government it’s not clear that it benefits everyone else. I
by sudhirj 5y ago
Inheritance taxes take wealth away from heirs, but unless there’s tremendous faith in the quality of government it’s not clear that it benefits everyone else. In the US the people who’d get richer from the government being flush with inheritance tax money are more Lockheed Martin / Blackwater / private prisons / Wall Street / consultants. In India it would be bureaucrats and their cronies. I’d rather the wealth be passed on and used productively, or squandered into the local economy. Happy either way.
- klyrs 5y agoPerversely, the government doesn't need to spend the tax money. The government can create money for whatever it wants. It can also simply destroy money, to fight inflation and/or the yawning wealth gap.
- burntoutfire 5y agoGiven how much USD is held by parties outside of US, a big part of the benefit of destroying USD would go to people outside of the country.
- KingMachiavelli 5y agoThis argument would apply to any tax but the question is not how much the government should tax or spend but rather if an inheritance tax is somehow (1) good in itself or (2) no worse than other taxes. The case against #1 is that no inheritance tax unless absurdly comprehensive could capture many pre-inheritance benefits. The article explicitly notes how some postpone accepting their inheritance as a form of virtue signaling. The very fact this can be done shows that wealth is being passed down prior to any taxable event.
- zoolily 5y agoInherited wealth leads to powerful dynasties, both at the local and national scale, who dominate local politics as well as economic opportunities. We see that in both India and the US.