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Politics : The Citizens Manifesto
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To: Road Walker who wrote (302)7/23/2005 11:44:57 PM
From: Elroy  Read Replies (2) of 492
 
How about this as an idea. People complain that wealth gets concentrated in too few family's hands. On the other hand if you tax inheritance or any earnings too highly, then the incentive to create wealth diminishes and we'd never get great leading companies like MSFT.

So how about if an entrepreneur were able to pass on all his wealth to whomever he wanted at the current tax rates, but those recipients could only pass on to their heirs the amount that they have declared as groos income on their lifetime income taxes. So Gates can give his kid the entire $40 billion he has earned and created and his heir pays the current tax rate, whatever it is. But when Gates' kid wants to pass on say the same $40 billion to his heirs, he can only pass on the amount the he has declared on his personal taxes during his life at the current rates - the remainder would be taxed at a much higher rate.

The basic theory being he didn't earn most of that (his dad did) and keeping the wealth in one family that did nothing more than be born into the family (they didn't earn it themselves) isn't necessarily good for the American system.

So the heirs of a person that inherits significant wealth would get taxed at a higher rate on any wealth that the receive that their beneficiary did not create during his/her lifetime.
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