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Capital Gains And Transfers

Volume 889: debated on Tuesday 25 March 1975

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asked the Chancellor of the Exchequer if he will set out for Germany, Belgium, France, Holland, Italy and the United Kingdom a table showing in which of the countries which have a capital gains tax, where a gratuitous transfer of capital other than cash either in life or on death results in a possible charge to capital gains tax, is the liability to capital gains tax ignored for the purposes of valuing the capital gratuitously transferred in order to assess the tax on the gratuitous transfer.

None of these countries, apart from the United Kingdom, has a comprehensive capital gains tax. In Italy a capital gains tax charged by municipalities on gifts and bequests of real property is credited against gift tax or death taxes. Information is not available about possible interactions in the other countries between their limited taxes on capital gains and gift or inheritance taxes.

asked the Chancellor of the Exchequer if he will set out for Germany, Belgium, France, Holland, Italy and the United Kingdom a table showing which of these countries tax gratuitous transfers of capital by any one donor during his life and on his death on a cumulative basis.

The United Kingdom charges all gratuitous transfers of capital by any one person during his life and on his death on a cumulative basis. Apart from Italy, the other countries mentioned have inheritance taxes and taxes on lifetime gifts which are in principle charged on the donee.In Germany gifts or inheritances received by the same person from the same donor are taxed cumulatively within a 10-year period.In Belgium there is generally no cumulation.In France gifts and inheritances received by the same person from the same donor are taxed cumulatively.In Holland (i) gifts within six months of death are accumulated with inheritances by a person from the same donor; (ii) gifts within a two-year period generally —within one year for gifts by parents to children—are accumulated when made to the same person by one donor. This accumulation does not apply to gifts on death.Italy has both an estate tax and an inheritance tax, together with a tax on lifetime gifts charged on the donee. Gifts and inheritances received by a person from the same donor are charged cumulatively and the total of a deceased's lifetime gifts is taken into account in arriving at the rate of the estate tax.

asked the Chancellor of the Exchequer if he will set out for Germany, Belgium, France, Holland, Italy and the United Kingdom a table showing in which of these countries there is a capital gains tax; and what the rate of tax is in each country which has one.

Apart from the United Kingdom, none of the countries specified operates a comprehensive capital gains tax, but all of them levy tax on certain capital gains of private individuals, and on most capital gains of businesses and companies. In the United Kingdom the maximum rate of capital gains tax is 30 per cent. In the countries listed there is no single rate of tax on capital gains. Instead there is a multiplicity of rates which vary with the type of gain, the nature of the recipient and the amount of the recipient's income. The details are too numerous to set out in a table, but, if the hon. Member wishes I will write to him.