The Capital Gains Tax (CGT) is a tax that applies to the increase in the value of an asset or estate over a specific period of time. The CGT was introduced in 1936 with the aim of raising revenue for the British Government. There are a number of arguments in favor of introducing a CGT on inheritance. Firstly, it would raise significant amounts of revenue for the British Government.
A capital gains tax on inheritance would raise more revenue than what is currently being raised through inheritance taxes and would be more evenly applied across the country. The idea of a capital gains tax has been around for decades and has been proposed as a means of raising revenue.
Proponents of the tax argue that it is an efficient way to collect revenue, as it is easier to track than other taxes. Additionally, a capital gains tax would hit those who make the most money from investments more than other types of taxes. Critics of a capital gains tax argue that it is not efficient in terms of collection due to the fact that wealthier people are more likely to have invested in assets that are subject to a capital gains tax.
Additionally, they argue that the taxation of investments will deter people from investing in things like businesses and new technology. Ultimately, a capital gains tax system will be decided upon based on its efficiency and impact on the economy.
The capital gains tax on inheritance is designed to help discourage individuals from unnecessarily passing on assets during their lifetime in order to avoid paying Inheritance Tax.