Inheritance Tax
There has been much brouhaha about the word ‘Inheritance’ in the media over the last couple of days. It’s time I use the opportunity to talk about one of my favorite subjects. Seems like Sam Pitroda raised this issue which became a talking point in Prime Minister Modi’s speech recently. I don’t want to get into the politics of it but its imperative to talk in more detail about it.
Inheritance tax is an absolute must in society as far as I’m concerned, its been more than 800 years since we have moved past feudalism as the dominant form of society and letting people hoard wealth for generations goes against the facets of capitalism as far as I’m concerned. Simply passing on wealth over to the next generation doesn’t breed innovation and any beneficiaries of this would never have to work, struggle or create anything important to the world and instead just live off the money handed over to them by their parents or grandparents.
The lack of an inheritance tax signifies to me that we live in a world where luck is a much more important factor than talent intelligence or work ethic. Money would keep getting transferred over generation to generation and this cycle would continue forever unless the family lineage ends.
This means that people coming from not so illustrious backgrounds will never get the chance to compete on an even playing field against those coming from privilege and will have to do much more with much less unless they become Elon Musk or Bill Gates (who also came from money) and they simply won’t be able to achieve anything substantial in life and set up their kids for a middle class life at best and that nothing that anyone could ever do mean as much as luck.
In India where income inequality is so extreme, we require large inheritance or estate taxes to ensure there is some semblance of a level playing field. There could be a minimum bar to qualify for inheritance tax as I don’t think people who worked hard their whole lives to ensure a good life for their children should have it taken away but If 50% of Mukesh Ambani’s money can be used for the welfare of a million underprivileged kids and 50% is to be divided between his kids, they would still stand to be the richest people in India.
But now on the other hand, those million kids would now have a shot at a better life.
P.S I never have and never will understand peoples obsession with accumulating wealth. What do they need it all for? My belief in life is to have enough for me to have a great life, give a good headstart to my kids and maybe leave a teeny tiny bit for them. Rest all is pointless. This will require a more detailed spiritual talk but this is the general direction of my life.
