The Stench Of Old Money – A Fresh Look At Taxation

We love to go on about that evil ‘Top End Of Town’ and how they are able to avoid paying their fair share of the profits that they (presumably) earned.  But corporate taxation avoidance isn’t the only major problem with our tax system.  If we are serious about creating an equitable society where people reap the rewards of their own efforts and abilities, there’s a simple way to solve this whole defecit problem while also creating a fair dinkum ‘level playing field’ for our society. If we simply abolish all family trusts and other accountant-created tax avoidance mechanisms and introduce a 100% death duty, so that one’s entire estate is forfeit to the government upon death, I think there’d be significant benefits for society.

For starters, there’d be no incentive for people to spend their whole lives scrabbling to acquire assets far beyond what they need for their own existence.    How hard or easy one’s own life unfolded might be less about who your parents happened to be, what they owned and what they left you; and more about the contribution that you personally made to society.

As long as we support a society that is based on the absurd notion of dynastic wealth being handed down through the generations, the very idea of an equitable society is a nonsense.

Lots of baby boomers are due to start falling off their perches soon.  They won’t need all their wealth after that.  And their offspring who did nothing to earn it have no moral right to it.  So why not impose a victimless tax that will keep the government awash with money and ensure that future generations can grow up in a world where their economic circumstances have more to do with what they personally achieved, rather than which parents they were blessed with.

It seems that, as fast as a government can come up with a new taxation scheme, there’s a whole army of clever accountants who’s life work is in frustrating the intent of such schemes.    While tax avoidance continues to be seen as a technical issue, rather than a moral one, there can never be an equitable taxation system.  I see little to choose between a clever’ company moving its profits offshore, and a ‘clever’ family
businessman who’s accountant has set up a nice, safe family trust to minimise taxation and protect the family assets in perpetuity.

It seems to me that dynastic wealth and inheritance by succession are concepts that fly in the face of any dream for an equitable and just society.  They should be consigned to the history books, where they belong.  While they continue to be the basis of one’s financial and social status, any talk of an equitable taxation system is just shouting into the storm.

Only one small person’s opinion and no Ph.D to back it up.  But even little, uneducated people can still have ideas, however foolish.

Andrew Caddle 2014-12-05

www.andrewcaddle.com

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