Britain’s most unjust tax – Telegraph readers ship their verdict
However, the deal with dying responsibility has left some urging for different controversial levies to not be forgotten. Namely, stamp responsibility.
A brief excerpt of a letter written into The Telegraph by one reader, who prefers to stay nameless, reads:
Our nameless reader is just not alone in his views on stamp responsibility. The rising value of stamp responsibility levied on property transactions implies that shopping for a house now often comes with a big tax invoice, and plenty of Telegraph readers, together with Adam Atkinson and Jack T P, argue that it “taxes aspiration” and is “a tax to stifle growth that has always been counterproductive.”
In final yr’s mini-Budget, then-chancellor Kwasi Kwarteng doubled the nil-rate stamp responsibility band from £125,000 to £250,000 in England and Northern Ireland.
The different tax bands stay unchanged, so one pays stamp responsibility at a fee of 5pc on the worth of a property above £250,000 as much as £925,000, 10pc on the worth between £925,000 and £1.5m, after which a prime fee of 12pc above £1.5m.
In a rustic which more and more looks like the Government is out for each penny you earn, stamp responsibility is without doubt one of the taxes that readers really feel is probably the most unjust – second solely to inheritance tax (IHT).
The nameless reader’s letter on stamp responsibility, and others alike, prompted the fee of an unique ballot performed by this newspaper asking which tax readers imagine to be probably the most unjust.
62 per cent of over 12,000 voters imagine inheritance tax is probably the most unjust tax of all, whereas 18 per cent assume stamp responsibility is.
Despite an enormous variety of readers agreeing that stamp responsibility is the unfairest tax, IHT nonetheless comes out on prime for causes which our readers go on to clarify.
Many, for instance, warn how straightforward it’s below the present system for the very rich to keep away from paying, whereas the center lessons get stung for the total 40 per cent.
Reader Nigel Curtress, for instance, helps the argument that it’s the center lessons who’re hit the toughest – “it’s only the little people who pay the tax,” he says.
Nigel explains that “the really rich avoid it completely by transferring estates to their children when they still have a very good chance of survival. They then live in a nice house on the estate and the children inherit the stately pile. And so it goes on.”
In one other vein of argument, Simon Pearson argues: “Any tax that can be avoided by people like the King and the Duke of Westminster, or anyone else with the wit and resources to get timely advice, is pure evil.”
Some additionally emphasise that IHT is double taxation, which they view as deeply “immoral”.
As David Summers explains, “hard earned money that an individual used to accumulate wealth has already been taxed. Just because they get old and die should not give the Government the right to take it, denying loved ones and families what is rightfully theirs.”
Others despise the tax for extra sentimental causes.
“People forget that an inheritance is about more than hard cash,” asserts R Whinnett, whose maiden aunt, a nurse her complete life, was answerable for IHT when she died at 82.
“Her many beneficiaries considered themselves lucky to inherit the remaining money and for me it transformed my life.
“What hurt was the realisation that all her worldly goods had to be valued and sold, including items of sentimental value… Seeing cherished but not particularly valuable items monetised in this was distressing.”
This sentiment is shared by John Hall who believes, “leaving the family home to one’s children is an act of love. The state stealing it is criminal.”
While some take subject with not having a say over how their hard-earned cash is spent, elevating fears of it being wasted within the fingers of the Government, notably on methods and causes akin to immigration and web zero.
D Morrell argues that it’s “better for private individuals to have the money than give it to the Government to waste.”
Reader Ok Furley shares how his children have labored since they have been 14, and went to school, however can’t afford a home. Therefore, Mr Furley feels it’s his “right and theirs to benefit 100 per cent from my meagre estate”.
“Why should the Government take from it? Who personally will benefit? It would be wasted and disappear into government hands,” he continues.
Echoing Mr Furley, John Youngs sees inheritance tax as “stealing from the responsible members of our community and giving to the feckless.”
For most, scrapping the levy is the one affordable end result, urging the Government to observe within the footsteps of Australia, New Zealand, Israel and Sweden. Reader Andrew Okoye, for instance, believes that “no one should be punished for being highly productive, sensible with money or for sacrificing themselves for prosperity.”
Some, nevertheless, favour reform over abolishing the tax solely. Reader J Ward, for instance, suggests “raising the threshold to £5 million for each person” to make it “much fairer”, whereas the likes of Tim Higgs recommend closing these exclusionary loopholes so “everyone eligible actually pays.”
For others, akin to our unique nameless reader, together with one other reader, Mark Johnson, stamp responsibility is extra unjust as “inheritance is an unearned gift to the beneficiary”, whereas stamp responsibility is “a tax on the mobility of the living, where you get taxed time and time again on the same income every time you sell your house.”
Others in settlement spotlight how the present fee of stamp responsibility discourages pensioners from downsizing when needed.
Fritz Smith, for instance, shared: “We are in a five bed in London and would want to downsize locally but paying stamp duty of over £120,000, plus all the costs of moving, isn’t worth it.”
Reader Gertrude Bloom, who believes the levy “discourages mobility and reduces transactions,” as a substitute suggests “a property tax on the value of the property would be fairer and would incentivise downsizing.”
Graham Barnes advocates for the scrapping of stamp responsibility, and like Ms Bloom, argues that “it is hugely damaging to mobility around the country and to economic productivity.”
Mr Barnes continues: “Why take a new job somewhere in the country if you have to pay £20,000-£30,000 stamp duty to buy a new house?
“The bottom line is that everyone is put off moving by stamp duty, not just pensioners.”
Of the charges, P. ED thinks they’re “totally out of whack with house prices, particularly in areas like London and the Home Counties where you would be coughing up the guts of £100,000 for moving into a good family home.”
Mikael Armstrong believes stamp responsibility must be axed or considerably lowered, as it could enable for individuals to “move to properties which suit their needs and would allow for a much better allocation of property. It would allow people to move house to where they work more frequently and it would also dissuade people from endlessly extending houses rather than just moving to somewhere more suitable.”
Few would disagree with paying a specific amount of tax, however it’s clear when listening to Telegraph readers that it isn’t merely inheritance tax that they discover unpalatable and in want of abolition – stamp responsibility wants revising, too.