It is almost always a sombre day when somebody dear to the self departs the present life and embarks upon a journey to the next. The atmosphere of mourning and grief (the anatomy of which is contemplated upon here) that lingers amongst those of us left behind to contemplate this departure is made none the better when legal issues regarding the will of the departed start to get considered. Possible conflicts and disagreements amongst the surviving heirs can be bad enough but then also enters into play the matter of paying inheritance-related taxes to the Government.
Some would think that it makes a lot of sense. Why should a person, who suddenly gets a windfall of, say, a couple of hundred thousand Euros, not get taxed for his fortune? Such sentiments are generally especially prevailent amongst those who either do not expect any such magnitude in windfall and, to a lesser extent, amongst those who have already had to fork out taxation on a departed member.
The thing is, while the rationale behind such arguments is valid in that it seems to logically fit in with the notion of the relatively wealthy paying something more in proportion to society than the relatively poor, there remains not only a moral dilemma in fairness to be overcome but also a series of exceptional circumstances where the issue of spoliation comes in.
Firstly, presuming that the departed was an honest individual, all the inheritance that would be passed on to others is itself already representative of a gross amount deducted by tax. His or her sources of income are taxed and so are his possessions, unless gifted to the departed by somebody else who also likely paid tax. Therefore an inheritance tax already poses a dubious outlook in terms of fairness as a tax on top of a tax.
There are also issues of spoliation, the notion that taxation can actually ruin the inheritance. For example, if a house were to incur an inheritance tax of, say, twenty five thousand Euros then the property would need to be sold so as to satisfy the coffers of the State.
This could mean that a mother of three who’s husband has departed would need to go out to work so as to be able to keep the home that she could have been living in for a good decade or so. Such obviously presents a further moral dilemma. The same could apply to siblings who share a home.
To grant exceptions is not the way to go in such instances. One would need to publish a booklet of such exceptions or place arbitrary conditions that merely shift around the problem in the hope of the overall problem becoming less prominent, a little like shifting ingredients in a frying pan to prevent the food getting burnt.
As such it makes a lot more sense and would actually be more ethical, consistent and just (not to mention more sensitive to the needs of family or friends whom are in a state of mourning) for any such kind of taxation to be reviewed and abandoned.
Entries (RSS)