Rick Procter-Lane

We need to tax wealth not work. Why? Because usually no matter how hard you work, the compound interest on huge wealth grows much faster than your wages + the rich use this passive income to buy all the assets. Someone made a game to show this: therichdont.work

@WilliamXnote @DanielPriestley I’d go so far as to say, maybe what we need is better described as ownership reform, more so than wealth tax 🤔 I am very much in favour of scrapping council tax in lieu of a land value tax too though @garyseconomics @PatMillsUK @PatrioticMills @TaxJusticeUK @CoopParty 🍀 5/ends.

@WilliamXnote @DanielPriestley I don’t object to successful entrepreneurs having a much larger ownership share by the way. I understand how risk taking & entrepreneurial spirit need to be rewarded more than just being an employee. My issue with the status quo is the extent of the imbalance of the two sides. 4/

Not everyone can or should be an entrepreneur. Entrepreneurship is hard and risky. It's hard because you are juggling something new into existence. Entrepreneurship requires lots of experiments, lots of failure, lots of hustle. It's risky because it involves putting time, energy, creativity, confidence and resources on the line that you may never get back. A small group of people can do it well enough to earn a wage. An even smaller group can do it well enough to make a profit on top. Even smaller still can scale-up. A tiny number of people do it so well that they grow, scale and create serious wealth. Success as an employee doesn't tend to have extremes. There are very few employees who lose the lot and go bust and very few who get a "retire in your 40s amount of money". Entrepreneurship has more extreme outcomes. When I talk about entrepreneurship, I am talking to people who are already building businesses or are in the process of setting one up. I don't try to convince people to become entrepreneurs unless they know what they are getting into. I often tell people to work on an entrepreneurial team for 2 years before starting one. When I talk about the benefit of entrepreneurs in the UK economy, I am NOT saying everyone should be an entrepreneur. I'm saying the economy benefits by keeping them here. The really great entrepreneurs can be anywhere in the world right now. They thrive on the entrepreneur ecosystems and if they leave, the country misses out on the value of what they create - the taxes, the jobs, the vibrancy, the learnings. In the same way we need dentists, but not everyone needs to be a dentist. We certainly don't want to push dentists to leave the country if we have a shortage of them. Right now the UK entrepreneur ecosystem is in decline. The best of the best are leaving, the investment is going elsewhere, the vibrancy has been sucked out of the room. It wasn't like this - London was one of the best places in the world for entrepreneurs not long ago. We need to turn this around. The constant talk about wealth taxes, the horrible culture of hating the rich, the what-aboutism, it's not going to be good for anyone. We are entering a new world. Technology is about to disrupt every industry at a scale we've never seen. Small teams of 50 people are going to disrupt businesses that employ 5000. Good jobs that have been around for decades are going away. This will happen regardless of what any country tries to do because it's all digital. No free country has been able to stop Netflix from putting its video rental stores out of business. No one has escaped smartphones sucking in people's attention. No country isn't using email. Technology rolls forward if you like it or not. Those countries that own the technology businesses dominate those that don't. Now more than ever we need to build entrepreneur ecosystems to discover the business models of the future. We need to create companies that surf the waves of disruption not just get dumped by them. We need to cheer on the entrepreneur who will build the economy of the future rather than trying to drown them as they are getting off the ground. Or, accept that they will leave and do what they do elsewhere.

@WilliamXnote @DanielPriestley Aha, so you’re a supporter of land value tax? Now that’s the stuff 👍🏻

@RickProcterLane @DanielPriestley That then just leads you back to capital gains taxes for when you eventually sell up Corp tax plus divi tax = c55% before you sell up The only wealth tax that’ll work is 1% annually on market value of every property to replace council tax

@DanielPriestley I don’t have any experience of that sort of thing, I’m just a lowly non-entrepreneur 😉

@RickProcterLane What's your experience with VC, scale-ups etc?

@DanielPriestley Anyone whose net worth surpasses £10m and doesn’t feel a sense of humility should check their privilege. Taxing their wealth isn’t a slight on their entrepreneurial efforts or a deterrent to others wishing to emulate. It serves to protect the labour of all the non-entrepreneurs.

@DanielPriestley The majority of people who are not destined to be entrepreneurs have to have some of their own hope Daniel. I take your point about entrepreneurial ecosystems but I can’t believe that anyone starting with no money but strong entrepreneurial spirit would be put off by a £10m cap.

@WillsCharityLaw @stokesbaytrader @paullewismoney Ah, on the face of that then, no such farmers have anything to worry about, surely? The one aspect that I’d still be inclined to query is, how is what you’ve described assessed by HMRC? Is that what farmers are currently worried about? The flaws of HMRC assessment of such things?

@RickProcterLane @stokesbaytrader @paullewismoney If the farmer needs to retain the farmhouse or income from the farm, that is likely to preclude the option of a gift. As the gift will not be effective for IHT, whatever period they survive.

Clarkson Farm. Assume worth £4.25m and all other allowances used up and not left to spouse/civil p. Leaves as cash or property IHT = £1.7m Leaves farm before 6/4/2026 IHT = £0 Leaves farm 7/4/2026 or later IHT = £650,000 So after change heirs still save £1,050,000 tax

@WillsCharityLaw @stokesbaytrader @paullewismoney Apologies, I don’t follow, sometimes Twitter forces too much brevity. Can you elaborate?

@RickProcterLane @stokesbaytrader @paullewismoney The 7 year rule only applies if you retain no benefit from the asset gifted. Unless the farmer has sufficient other resources (and place to live?), cannot just gift and survive 7 years.

Am I making you proud @garyseconomics? I really hope so 💚✊🏻

@stokesbaytrader @paullewismoney I’m genuinely unsure about the debt element of this, however you do refer clearly here to UNREALISED CAPITAL GAINS and that is so crucial in my view. Stockpiled and hoarded unsold wealth is somehow outside the system and this is surely so brutally unfair. Tax excessive ownership!

@RickProcterLane @paullewismoney For me it's not so much the numbers but more about the system is designed to allow rich to avoid paying same % as everyone else. Using debt to avoid ever realising any capital gains is the worst.

@stokesbaytrader @paullewismoney In this case, it’s lack of both knowledge and power, or at least the perceived lack of power. The true extent of wealth inequality is genuinely extremely hard to get your head around, but once you have, you realise it’s by far the biggest scandal of our age, possibly of all time.

@RickProcterLane @paullewismoney Correct. I live and worked in the trust industry in Jersey and it's all about avoiding tax and keeping your wealth quiet. I don't know why UK electorate put up with it. Again, they either don't know or feel powerless.

@stokesbaytrader Maybe by the late 23rd century, just like Gene Roddenberry predicted (for any Trekkies out there), money itself will have ceased to exist entirely. One can but hope 🍀

@RickProcterLane Trump is a very understandable yet misguided vote. We need a blockchain vote system for all laws and no centralised govt. Radical but we all then have the same power.

It might look like there’s a lot to unpack here, but just imagine the unboxing video, what a Christmas present! (Now watch all the accusatory replies come in, assuming I’m either hard left or hard right, unless no one out there is that bothered about making an ass of you and me).

@stokesbaytrader Hehe, well now we’re into the real radical stuff, but I like it! 😀

@stokesbaytrader @paullewismoney I remember interacting with you previously about a debt tax. Sounded promising at first but actually I think it would just get passed on down to the consumer (so often happens). What really needs taxing is excessive asset ownership. Surely that is possible, ask @garyseconomics ✊🏻

@RickProcterLane @paullewismoney Agree. Either a wealth tax or debt tax. Debt tax is easier to administer as lenders are regulated already and can add to interest cost and pay onto govt. Also valuation is easy.

@stokesbaytrader @paullewismoney If I understand correctly, there is IHT on death if NOT transferred - but there is also IHT on death if it WAS transferred in 7 years prior to death. Most IHT is avoided by wealthier people (family offices) using trusts. Again, middle squeezed while superrich get off scot free 🤬

@RickProcterLane @paullewismoney Well then that's just luck. There would be iht on death if they hadn't transferred the farm, no?

@stokesbaytrader @paullewismoney Assuming my figuring is correct there, I would propose instead the complete abolition of IHT (and CGT for that matter) in favour of a functioning wealth tax. I refuse to believe that it’s impossible to design an annual #WealthTax that actually works.

@stokesbaytrader @paullewismoney I do broadly agree with this. The catch is, let’s say there’s a farmer who does this and is unlucky enough to die relatively young and almost straight away with their spouse doing the same. Then the 7-year rule brutally punishes the family specifically for just being unlucky, no?