Above this, the rate should advance
rapidly, and should be progressive, not proportional. A 50% tax on
inheritances above $250,000 seems to us desirable, since large
inheritances tend to interfere with the correlation of wealth and social
worth, which is so necessary from a eugenic point of view as well as
from that of social justice.
The Federal estate law, passed in September, 1916, is a step in the
right direction. It places the exemption at $50,000 net. The rate,
however, is not rapid enough in its rise: e.g., estates exceeding
$250,000 but less than $450,000 are taxed only 4%, while the maximum,
for estates above $5,000,000, is only 10%. This, moreover, is on the
total estate, while we favor the plan that taxes not the total amount
bequeathed but the amount inherited by each individual. With the ever
increasing need of revenue, it is certain that Congress will make a
radical increase in progressive inheritance tax on large fortunes, which
should be retained after the war.
Wisconsin and California have introduced an interesting innovation by
providing a further graded tax on inheritances in accordance with the
degree of consanguinity between the testator and the beneficiary. Thus a
small bequest to a son or daughter might be taxed only 1%; a large
bequest to a trained nurse or a spiritualistic medium might be taxed
15%.
Pages:
536
537
538
539
540
541
542
543
544
545
546
547
548
549
550
551
552
553
554
555
556
557
558
559
560