The Office of Tax Simplification is the modern-day equivalent of the Commissioners for the Reduction of the National Debt (they still exist) and has a similarly thankless task. Simplification is no match for politicians’ complication, as the Scottish government has just demonstrated with its local income tax changes.

The Office is looking at an older cat’s-cradle of rules, those enmeshing inheritance tax, and this week a study for the Resolution Foundation recommended axing it. IHT is often described as a levy paid only by those who trust the taxman more than they trust their relatives, so the foundation’s proposal is that the recipients should pay it instead. As with pay-as-you-earn, the theory is that the grateful relatives would not miss being taxed on money they had never seen.

This has a superficial attraction, but would quickly become just as complicated and avoidable. Meanwhile, the market is starting to find its own solution to the problem of wealth concentrated in geriatric hands. The yield from IHT has more than doubled in a decade, to £5.2bn, thanks to rising house prices and freezing the exemption limit.

If this stays unchanged the yield, forecast at £5.4bn this year, will rise swiftly thereafter, as homeowners die, making room for income tax cuts for moderate earners and offering them a better chance to afford their own homes. In contrast, Resolution’s bizarre suggestion that every youngster should be given £10,000 is an even worse idea than Help to Buy, George Osborne’s crowd-pleaser which has helped to buy yachts for housebuilders.

The  IHT debate is usually phrased in terms of passing on hard-earned wealth to your children. This is cant. The vast proportion of this wealth has come from merely standing on the escalator of rising property prices, so raising the tax-free threshhold would be another bribe to elderly voters. Besides, IHT remains the most optional of taxes. All it takes to cascade the wealth down the generations is a little planning – and to trust your relatives.

A shocking way to go

Simon Dingemans was a brilliant investment banker with Goldman Sachs before he left in 2011 to become finance director of one of the bank’s major clients, Glaxo Smith Kline. Now he is to leave next year. So are his fellow directors following tradition and showering him with shareholders’ money? Well, no. Because it’s his decision to go, there will be no leaving bung or any more of the incomprehensible incentives without which no modern company executive gets out of bed.

Mr Dingemans – who is also unusual in having no non-exec roles to distract him from his day job – is not going to be popular. After all, behaving like a normal employee is not what is expected from a departing executive director. Stepping off the gravy train without the comfort of a large cheque simply isn’t done.

Sadly, it remains impossible for an outsider to work out from the 28-page remuneration report (try it) how much he will get in his final year from the pile of basic salary, benefits, pension, annual bonus and long-term incentives. And however good he was at his job, it’s worth noting that we GSK shareholders have had a thoroughly miserable time whilst he has been on board. Still, full marks for leaving with dignity instead of dosh.

 

Argie bargy

It is only 11 months since Argentina persuaded the world’s banks to lend it money for 100 years, but the prospects for another 99 years of 7.9 per cent interest payments already look bleak. The central bank’s decision to hike its rate to 40 per cent this week is a cry of despair, rather like Norman Lamont’s raising British Bank Rate to 15 per cent to stay in the exchange rate mechanism.

Nobody believed him then, and no economy can operate for long with money costing 40 per cent. The choice is austerity or default, and since Argentina endured debt crises in 1930, 1955, 1976, 1989, 2001 and 2014 in the last 100 years alone, you can see the way to bet. A century before that, Argentina had offered Britain the Malvinas in return for writing off the debt to Barings. The offer was rejected on the grounds that Britain already owned the Falkland Islands. Accepting it would have saved a great deal of trouble.

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