ESTATE DUTY - A CASE FOR ABOLITION IN SINGAPORE

Abstract

Taxation is the main source of revenue for public expenditure. Most taxes are relatively productive in terms of revenue. They are property tax, stamp duties and income tax. The revenue from estate duty has become rather insignificant today. This is due to the nature of estate duty as a tax, the substantial exemptions available and the fact that the tax can be avoided by proper planning. In view of this, a question may be posed as to whether estate duty should be abolished. On the other hand, supporters of the tax will argue that estate duty helps to redistribute wealth and therefore the complete abolition of it can be criticised. However, this does not mean it cannot be done. This dissertation examines the United Kingdom and Singapore tax systems. It highlights the pros and cons of estate duty and considers the case for the abolition of estate duty in Singapore having regard to its dismal record as a source of revenue. In addition, it examines the practice of avoiding estate duty through proper tax planning. This is the main consideration in an argument for the abolition of estate duty.