Life has meaning again, now that Downton Abbey has returned to our TV screens, its fifth season beginning last Sunday. Its otherworldly visuals continue to draw me in, with the upstairs goings-on of the aristocrats and the downstairs drama among the servants still as captivating as ever. I actually have to remind myself every time I watch an episode that people from another continent in this world of ours actually lived like this less than 100 years ago: that cooks had to dine separately from the rest of the servants in a stately home; that members of the upper class changed clothes as often as five times a day; that it was inconceivable that a proper lady or gentleman would have to perform actual work to earn a living.
But beneath this lush and flowery costume drama, behind the grand countryside setting with its traditional rules and the time-honoured class system and way of life, the heart of this series is very much about finances and fortune management, just like how Game Of Thrones is really about power and politics. Five seasons in, yet the death duties, land tax, inheritance tax and taxes of other sorts that could bring ruin to this high-born family still loom over the occupants of this great house. Since Thailand does not levy a tax on the estates of people who die and because I don't enjoy a view from the top of the social pyramid, I have always regarded death duties as something that will never concern me. If I've thought about the matter at all, it was as something my poor (deserving of pity, that is) rich friends from other countries might have to deal with at some point in their lives.
But now our government is talking about bringing in an inheritance law, too,
a change in the law that could possibly come into effect as early as next year.
As a means to decrease income inequality and redistribute wealth, the Ministry of Finance is considering new legislation that would require those who inherit assets worth more than 50 million baht to pay a tax of between 5% and 30% (some reports suggest the figure may not exceed 10%) on their endowment. Inherited assets subject to this tax would include houses and other real estate, land, cash deposits, vehicles, bonds and shares. Undeveloped land would be taxed more heavily than land already being used for agricultural or commercial purposes.
After news of this impending law change broke, the struggle Mary Crawley has to pay her inheritance tax suddenly seems more real and relevant to me. The stark choice facing her — between selling off a plot of land smack bang in the middle of the family estate to pay the death duties off in one go, or to pay the sum off in instalments using profits from the estate's hopeless farms — may one day face Thai families, too.
My own heir and heiress friends are scrambling, going berserk about the possibility of this new law being passed. Some are starting to look at countries abroad to which they can transfer their money. Some are thinking of converting their cash into luxury watches, and at least one person I know is thinking of taking out Maltese citizenship.
Nobody likes to part with their money, but a major reason why so many rich Thais clearly detest the concept of an inheritance tax is the lack of transparency in the system. What happens to our tax money anyway? Paying out so much money for no apparent benefit would be like throwing their cash into a black hole, wouldn't it? A friend said she felt that bringing in an inheritance tax would be like robbing her twice; it's as if the income tax she already pays (something that poor Thais don't have to pay, she points out) weren't enough.
Inheritance tax is a sticky subject, yet countries like Great Britain have had it on their statute books for more than 100 years. It's probably on the cards for Thailand, too, but if (or when) this tax is introduced it should be done in a gradual way so that people don't plummet into debt, as was the case in Japan, apparently. A tour guide there once told me that inheritance taxes in Japan were so high that people were often forced to sell off their ancestral homes. So much pressure followed an inheritance and people who couldn't afford to pay the tax without selling off significant family assets sometimes considered suicide as the best escape from a situation they saw as shameful.
Any rate set in excess of 20% will probably make many well-heeled Thais run for the Maltese citizenship application line. It's not the super-rich who suffer most from a tax like this, it's the heirs of small- to medium-sized business owners who may be forced into selling shares in their family business, or putting land or even their family home up for sale. What a terribly unfair burden to place on the shoulders of someone whose parents may have worked hard all their lives to legally acquire these assets in the first place.
While I do agree that the rich should chip in, I don't agree they should be the sole target for this "tax-harvesting". Just because they are rich doesn't mean that they should be totally responsible for funding the government's budgets or helping to make the world a better place.
It's everyone's duty; no particular group should be overburdened with the costs of developing this country — even the poorest of the poor should be playing their part.
Parisa Pichitmarn is a feature writer for the Life section.