Estate and inheritance taxAn inheritance tax is levied upon an individual’s estate at death or upon the assets transferred from the decedent’s estate to their heirs. Unlike estate taxes, inheritance tax exemptions apply to the size of the gift rather than the size of the estate. es are not the only “death taxA tax is a mandatory payment or charge collected by local, state, and national governments from individuals or businesses to cover the costs of general government services, goods, and activities. es” grieving families must pay. There is also the matter of taxes on funerals.
Canadians do not currently have an inheritance tax, but many are unhappy about their taxes on funeral expenses. One Canadian woman, distraught over the more-than-$900 tax bill she faced after her son’s funeral (a combination of a provincial sales taxA sales tax is levied on retail sales of goods and services and, ideally, should apply to all final consumption with few exemptions. Many governments exempt goods like groceries; base broadening, such as including groceries, could keep rates lower. A sales tax should exempt business-to-business transactions which, when taxed, cause tax pyramiding. and the 7-pecent federal goods and services tax) is conducting a petition drive to abolish federal and provincial funeral taxes. She appears to be facing an uphill battle.
Economists say federal officials don’t want to change the global nature of the tax because they believe that applying it to so much keeps it relatively low.
“The federal government gets hundreds of submissions a year asking for exemptions for this and that,” said David Perry of the Canadian Tax Foundation.
“I think the concern is that once they start opening the door, they will lose the grand scope of the tax ….”
Milton Peach, vice-president of the Funeral Service Association of Canada … said funeral directors were horrified when they first saw the 15 per cent HST and realized what it would do to the cost of a service.
But Peach said the funeral directors association has not been asked to lobby government on the issue, and he does not believe there is any appetite for a fight at this point in time.
Click here for more on U.S. estate taxAn estate tax is imposed on the net value of an individual’s taxable estate, after any exclusions or credits, at the time of death. The tax is paid by the estate itself before assets are distributed to heirs. es.Share