It is recommended to levy an inheritance tax. Hot search: Can an inheritance tax really narrow the gap between the rich and the poor?

2021/03/1012:44:03 international 818

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Wang Kang, representative of the National People's Congress, member of the Finance and Economics Committee of the National People's Congress, and chairman of the Chinese Taxation Society, suggested that measures such as the introduction of an inheritance tax could be considered in order to narrow the gap between the rich and the poor. This topic rushed into the hot search.

The so-called inheritance tax refers to a country or region levying taxes on the inheritance left by the deceased, sometimes called "death tax" abroad. The purpose of contemporary inheritance tax has been very single, which is to narrow the gap between the rich and the poor. However, the inheritance tax originated at the time to raise funds for war and military expenditure.

was first produced in ancient Egypt more than 4000 years ago. Out of the need to raise military expenses, the Egyptian pharaoh Khufu levied an inheritance tax. The modern inheritance tax was levied in the Netherlands in 1598, and then the United Kingdom, France, Germany, Japan, the United States and other countries have successively imposed inheritance taxes. The main purpose of levying inheritance taxes in modern countries was also to raise war funds, and the levy was stopped after the war. It was only after the 20th century that the inheritance tax changed its main purpose to adjust the gap between the rich and the poor among the members of society.

So, can inheritance tax really narrow the gap between rich and poor?

may not be necessary.

Taking the United States as an example, the IRS found that although an inheritance tax is levied on the rich, when the rich become super rich, the income tax burden is reduced. Because rich people can use various circumvention methods, such as family trusts, gifts during their lifetime, charity, insurance, etc., the inheritance tax burden is not too high.

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In addition, the rich have more deductions (such as mortgages on yachts), and more capital gains rather than salary income (the salary income tax rate is up to 39.6%, and the capital gains tax is normal for more than 12 months 20%/23.8%).

On the contrary, the biggest disadvantage of levying inheritance tax to the country is that it causes a large amount of capital wealth transfer and outflow to other countries, which will seriously affect the investment funds of the country and cause a serious shortage of private capital required for economic development.

Take France as an example.

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France has an inheritance tax. In 12 years, French President Hollande levied an additional 75% "rich man tax" on the rich with an annual salary of more than 1 million euros. But what Hollande's government did not expect was that the rich voted with their feet.35,000 people left France to settle abroad that year. Among them, 587 were French people covered by the "wealthy tax". Their average assets were around 6.6 million euros, and half of them had average assets of more than 12.5 million euros.

It is recommended to levy an inheritance tax. Hot search: Can an inheritance tax really narrow the gap between the rich and the poor? - DayDayNews

In fact, the French "wealth tax" was only levied in 13 and 14 years (abolished in 15 years). The French government collected a total of 420 million euros, which is for France’s billions of deficits. Only a drop in the bucket.

Therefore, a few years after the introduction of inheritance taxes, many countries have stopped levying inheritance taxes because they cannot withstand the impact on the economy. For example, Canada, Australia, New Zealand, and Italy have stopped levying inheritance taxes one after another. Starting from February 11, 2006, Hong Kong officially abolished the inheritance tax. A spokesperson for the Financial Services and Treasury Bureau of the Special Administrative Region Government said that the abolition of the estate tax will attract more local and overseas investors to invest in Hong Kong, enabling Hong Kong to continue to be a major asset management center in the Asia Pacific region.

It is recommended to levy an inheritance tax. Hot search: Can an inheritance tax really narrow the gap between the rich and the poor? - DayDayNews

Singapore also abolished this tax in 2008.

Look at Taiwan again.

In 2007, the highest marginal tax rate of inheritance tax in Taiwan, China was 50%, and 300 million US dollars of funds flowed out that year. In 2009, the Taiwan region of China lowered the highest marginal tax rate of inheritance tax from 50% to a single tax rate of 10%. As a result, the inflow of assets reached US$20.7 billion that year.

Therefore, the levy of inheritance tax is not a one-time thing, it affects the whole body and requires rigorous argumentation. In fact, the collection of inheritance tax was included in the agenda at the beginning of the founding of New China, but it was never implemented.

Of course, insurance company brokers may be able to harvest a wave of business, because it is said that insurance can evade inheritance tax, "Insurance is the best way for the rich to avoid tax." I estimate that the insurance salesman’s call is already leading Rich people are on their way to mobile phones.

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