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- Local Sovereignty’s main page on inheritance law focuses on land. How would the suggested reforms affect other forms of property?
- Wouldn’t these proposed reforms clash with the right to enjoyment of private property?
The answers below are adapted from comments on a proposal to abolish inheritance that was put forward during the ConstitutionUK project.
Local Sovereignty’s main page on inheritance law focuses on land. How would the suggested reforms affect other forms of property?
Local Sovereignty’s basic position is that inheritance should be (and was originally) primarily about passing on responsibilities rather than wealth. main page
However, we don’t see any reason why people shouldn’t have a free hand in passing on chattels, even where they have high market values. The fact that someone might pay a fortune for a work of art, for example, doesn’t mean that possession of it impoverishes others in any way (unlike real estate, where we compete for a fixed amount of it and cannot live without using it) so we see no reason for the state to constrain people’s ability to bequeath it to whoever they like.
The arguments are more complicated when it comes to paper wealth. Our position is that things like stocks and shares etc, where ownership is primarily a matter of contract rather than possession, should be treated in the same way as land – i.e. that the current owner has a responsibility, delegated by the Crown, to nominate a successor, and should do so in the public interest.
Obviously, establishing what the public interest is would not be straightforward and such forms of wealth cover a huge range so there would be an awful lot of detail to be worked out. At one end of the scale, for a small family firm, the public interest would often be for it to pass to the owner’s offspring, as it does today, because that is clearly a transfer of responsibility. At the other end, it’s hard to see much benefit in shares in a PLC passing that way, because that is merely a transfer of wealth. But even that isn’t as clear cut as real estate.
Wouldn’t these proposed reforms clash with the right to enjoyment of private property?
We don’t see clashing with the right to enjoyment of private property as a problem, for the simple reason that, for the most part, ‘property’ is a construct of the law – therefore how it is defined is more fundamental than the right of enjoyment. Ensuring that property rights are defined in a way that is consistent with modern values should automatically mean that people’s enjoyment of their property will be consistent with those values.
The most important forms of property, the ones which significantly affect other people’s economic freedom, depend on legal title rather than possession. In the case of real estate, those titles were originally defined at a time when a central purpose of law was to establish and maintain a stratified society – a society in which the bulk of the population was explicitly made subservient to a minority. It’s no surprise, when we continue with the definitions of property which came into being at that time, that serious inequality defies all attempts to eradicate it.
The roots of the law (and the rights and wrongs of current ownership patterns) aren’t so obvious in the case of commercial organisations. But there too, ownership is essentially the product of law so it is important that owners’ rights are based on sound principles which take proper account of the impact those organisations have on the social landscape. It seems absurd, for example, that there is no explicit acknowledgement that the owners of corporations are trustees for future generations – not merely their own descendants but also everyone else whose economic freedom will be affected by the existence of those organisations.
Unless we properly maintain its foundations, the whole edifice of the law will become ever more inflexible and oppressive, as layer upon layer of additional law is introduced to try and mitigate the ill-effects of what is already there. Inheritance tax is a classic example of that; the state takes with one hand (part of) what it has given, carelessly, with the other. The result is dissatisfaction on all sides – a burning sense of injustice on the side of those who receive no inheritance themselves, and resentment on the side of those who see the state depriving them of what is ‘rightfully’ theirs – which in turn creates a political battlefield which would in fact cease to exist if the flaws in the underlying laws were dealt with.