"Death and Taxes"

Nobody likes to pay their tax, the very term "tax" is synonymous with a burden, it is arduous, and for those of us who don't have our taxes deducted at source, it feels like we are having our hard earnt income taken away from us. For many years there seems to have been a World wide consensus that tax should be fair, that taxation should reflect an ability to pay. It was breaking this principle with the much hated "Community Charge" or "Poll Tax" that ultimately brought down the UK's Thatcher Government. From a simplistic point of view a Poll Tax might seem fair, each person contributing the same to the community with the same right to draw on services as needed, however a very large majority didn't see it this way, and many rioted to underline that!

The principle of "fairness" has meant that taxes tend to be levied on wealth, income, or property rather than simple existence. Governments tinker with rates, thresholds, and liabilities but the basic principle is generally that those with "the broadest shoulders should pay the most". 

Not Happy!

All this has come to mind as here in the UK the Government has recently announced that Farmers will no longer enjoy a 100% exemption from Inheritance Tax, they will still enjoy a 50% reduction in the rate and the threshold for the size of the estate that will be liable is much higher than for everybody else, but our framers still feel hard done by as an estate worth £3 million or more will now be liable for tax at 20% (everyone else pays 40% on an estate over £325,000). Indeed we have recently seen the rare sight of farm tractors in Whitehall and Parliament Square as some farmers make their feeling felt. I struggle to feel a great deal of sympathy for them, a few years ago when my Mother died we fully accepted that we might have a liability to pay some tax, and that this would mean the continued erosion of any "family fortune" there may ever have been. Most families who may have a liability will plan for the tax, with trust funds and gifts, family owned businesses can plan by setting up limited companies etc. The thing is farmers don't appear to be used to the idea that they are businesses as well as a way of life, at the moment they have a knee jerk reaction that they are being attacked. I believe that once the reality sets in most will realise that this may actually be in favour of tenant farmers, as wealthy non farmers will no longer be "investing" in farm land as a way of dodging Inheritance Tax, more and more family farmers will have to constitute themselves as proper businesses and start to enjoy the taxation advantages of being companies rather than sole traders. I am very much of the opinion that farmers are still getting a pretty good deal, and are still in a very privileged position!

Even though I am now a pensioner I still have a tax liability, a certain amount is taken out of my occupational pension each month, and at the end of the year after I have made my tax return I expect to have a bit more to pay. I am not rich, I do not have a high income, but I still have a liability. I rather think I should be glad about this! The more income I have the more tax I have to pay, so having to pay tax is an indication that my income isn't too low! There are certainly plenty who are much worse off than me! Through my taxation I am contributing to my own and others safety, I help to support the armed forces, the Police, the Health Service and Ambulances. Through my taxes I am helping to provide child care, social services, education. My taxes mean my waste bins get emptied, the roads are maintained and that we still have public parks.

When we pay our taxes it doesn't mean we are supporting the Government, it means we are supporting society, so maybe we should be glad to pay them.