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Frugal Scots

May 20, 2003

A good piece in 'The Scotsman', written by John Blundell of the Institute of Economic Affairs denouncing inheritance taxes as an assault on thrift and a spur to wasteful consumption, to the detriment of all.Positively Austrian in its message about 'trivial' expenditures

http://www.thescotsman.co.uk/business.cfm?id=564292003

'We want wealth to fall down from father to daughter, from mother to son. Adam Smith, sagacious as ever, wrote: "Every frugal man is a public benefactor." Savings are not something to be punished. The state should abandon this malignant Jacobin Leninist idea. It belongs to the fringes of politics, warming the cockles of the likes of Tommy Sheridan.

In his penetrating study of inheritance tax Euthanasia for Death Duties, Dr Barry Bracwell-Milnes argues that penalising capital demoralises and depletes the rest of the economy. In a horrible paradox, he reveals inheritance taxes promote trivial expenditures rather than investment. How many thousands take unwanted world cruises simply because "we can’t take it with us"?

Studies show many perfectly healthy family firms never survive the death of one generation because of the incidence of a tax that regards successful trading and the building up of a small business as deserving of punishment. Measuring the damage done by a duty on death is far more oblique than adding up the taxes collected.'

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