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  ― 510 ―

III. Conclusion

26.25. Rather than a net wealth tax, the Committee concludes that it is better to concentrate on improving the estate and gift duty and to introduce a capital gains tax as these taxes can achieve broadly the same objectives as a wealth tax. In its view:

  • (a) an estate and gift duty can be made to serve the equity purposes of a capital tax more efficiently than a wealth tax.
  • (b) A reformed gift and estate duty would have substantially less adverse effects upon incentives to work and save, fewer liquidity problems, and a less disturbing effect upon investment patterns than a wealth tax.
  • (c) Above all, an efficient annual levy upon wealth would involve administrative problems of insuperable difficulty and be extremely costly to collect.

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