Thank God or should we say, the Govt, for not having the ‘death tax’ in India!
Death tax is a word coined by the Americans but in tax parlance, which Indians are more familiar with, refers to inheritance or estate tax.
Its taken for granted that when a parent passes on, his/her property is inherited by his/her children, grandchildren ward. In many countries, the heir must pay Inheritance Tax for inheriting any such property or assets from your parents or grandparents or any other relative or friend. In India, however, the concept of levying tax on inheritance does not exist now. In fact, the Inheritance or Estate Tax was abolished with effect from 1985.
But even in the US, this is essentially a tax of the ‘super’ rich. To be assessed the tax in 2018, only estates worth at least $11.18 million are liable, which applies to approximately 2,000 people or 0.0006% of the population. Right now this is attracting attention because Trump, a messiah of the super-rich for sure, wants to abolish it.
Taking an estate of £1.5 million left to one child, someone in the US, Sweden, Australia or Sweden pays nothing. Nor does the estate of anyone passing away in the Gulf States – Saudi Arabia, United Arab Emirates, Kuwait, Qatar, Bahrain or Oman.
Well, we bring this up because there is talk of the Govt paddling against the flow and considering instigating inheritance taxes. But maybe this is just talk; with an election looming large, this is a risk they will surely not take, at least not in 2019.