Example One of Taking Law Seriously in Fiscal Sociology: Taxing Inherited Wealth

Abstract

The final, two chapters aim to fulfill the promise of the previous chapters, and extends a fiscal sociological analysis to two examples. In a 2014 review of fiscal sociology , Martin and Prasad suggested that inequality, and development, needed to be considered from the perspectives of taxation. This chapter aims to do exactly that, starting with the example of Piketty’s proposal for a global tax on capital. Chapter 7 continues this analysis to the benefit cap litigation in the UK. These examples have been selected because of their significance in the post-financial crash era. In this chapter, the argument is advanced that Piketty’s proposal has the potential to be considered as a tax principle, as opposed to a tax rule—or, as Cooter described it, as an underlying value. The advantage of this approach is that it would afford Piketty’s proposal the opportunity of greater influence. As noted in the opening chapter (p. 8, supra) Piketty’s “global capital tax” already has had an impact on the OECD . The challenge, however, is that such a tax would not fit easily within existing tax principles in the UK, as a brief survey of important policy reviews seeks to establish. The aim of this review is to suggest that, in the context of tax, there often is something of an agreement on basic tax principles that are deeply embedded. If the conflict between principles is acknowledged at the outset, and if Piketty’s global capital tax were accepted on these terms, the prospect for success would increase. In the following chapter, the benefit cap litigation is reviewed. The conclusion from the application of a fiscal, sociological analysis to this subject is that the legal system aims to preserve the availability of the unpaid labour of women. Focusing only on economic modelling, and not on values (Cooter), norms (Prosser) and law (Ruffert), misses the point that budgeting and law have combined so as to provide a legal framework which does not protect women from suffering the brunt of budget controlling initiatives.