Inheritance tax: Indians not in favor to shell out
Finance Minister P. Chidambaram had first mooted the idea of imposing inheritance tax last month. During pre-budget consultations with ministers yesterday, some economists endorsed his idea. Notably, inheritance tax is imposed on the property that is passed to an heir.
THOUGH THE government has shown its inclination towards introducing inheritance tax, however, people are not in favor to pay such taxes.
“I think it (inheritance tax) should not be imposed. If father has saved something after paying each and every tax, and he is transferring that property to me. I need not to pay the taxes again on that property. It would be like double taxation,” Mamta Singh Rajput, a media professional, told this citizen journalist .
, an engineer by profession, said that inheritance tax would add to the burden of a common man. “Why should there be an inheritance tax? What's the logic of introducing this. My father or forefather must have paid taxes in the process of acquiring the property. Then why I need to pay inheritance tax,” said Chandra Shekhar.
In the past, India
had estate tax from the year 1953, which was abolished in 1985. Many countries such as Australia, Canada, Austria, Hong Kong, and Israel have abolished inheritance tax.
There is a distinction between an estate tax and an inheritance tax in international tax law. An estate tax is assessed on the assets of the deceased, while an inheritance tax is assessed on the legacies received by the beneficiaries of the estate. However, this distinction is not always respected in the language of tax laws.