HC Deb 25 January 1972 vol 829 c1184
11. Mr. Deakins

asked the Chancellor of the Exchequer if he will seek powers to amend the legislation on death duties so as to increase receipts, in view of the fact that such receipts have risen in recent years at a slower rate than the increase in personal wealth.

Mr. Maurice Macmillan

I have noted the hon. Member's proposal to increase the rates of estate duty.

Mr. Deakins

Is the Minister aware that, on the evidence available, there is a strong case for urgent action on this matter to prevent the present maldistribution of wealth becoming even more inequitable?

Mr. Macmillan

I think that the balance of evidence is to the contrary. The discrepancy to which the hon. Gentleman referred is due largely to three reasons: first, the introduction, in the two years in question, of capital gains tax, which reduced the larger estates and, therefore, the average rate of duty; secondly, the spread of wealth to the younger age groups, where deaths are obviously less frequent so that fewer estates pass annually; and, thirdly, the disproportionate increase among estates in the lower and middle range where the rates of duty are lower than average. These three elements go to show the reverse of the deduction which the hon. Gentleman was making from the evidence.

Miss Joan Hall

Does my right hon. Friend agree that less money has come from death duties because for far too long it has not paid people to invest their savings to help the community at large by investing in companies in this country and because for too long they have had to invest in goods and châttels which nobody but themselves could enjoy?

Mr. Macmillan

I do not think that the evidence shows that, because the Inland Revenue's estimates of the increase of wealth come from the same sets of figures as that which it collects for estate duty purposes.