A Fiscal Argument for the English Monarchy

There are many people in Great Britain that view the royal family as obsolete and, worst of all, a drain on taxpayers. Largely, arguments against the monarchy come down to money. Even though it works out to 56 pence a person, that’s still £35.7 million ($60.6 million, 44.5 million euros) of taxpayer money. So the UK should jettison the royals because they are useless, money-sucking parasites costing millions?

Not so fast.

For one thing, the royal family voluntarily pays taxes on it’s already taxed income from the Crown Estates:

“Whoever is the reigning King or Queen of England is is the benefactor of “The Crown Estate”. The Crown Estate is a $13 billion real estate portfolio that has been passed down by generations of British royals dating as far back as the 11th century. The portfolio includes nearly $10 billion worth of urban property and $3 billion worth of rural land. The Crown Estate owns golf clubs, parks, apartment buildings, retail space, mineral rights and much more. It even technically owns the marine life reaching 12 nautical miles off the coast of England. In 2012, profits from The Crown Estate were nearly $400 million! … In April 2012, Parliament passed the “Sovereign Grant” which entitles the sitting monarch to the rough equivalent of 15% of revenues from The Crown Estate. The remaining money goes directly to the Treasury. The Queen does not actually profit off The Crown Estate, she is just entitled to services equivalent to the predetermined amount. Services like travel, security and maintenance at the “Occupied Royal Palaces”. Typically, Queen Elizabeth uses between $40 and $60 million worth of public services each year. In 2012 The British government spent a grand total of $52 million on property upkeep, communication, security and travel expenses for The Queen … The Queen’s private income, also known as the Privy Purse, is mainly derived from her ownership of The Duchy of Lancaster, a 46,000 acre territory that has been passed down to the sitting monarch since 1399. The Queen earns around $25 million per year off The Duchy of Lancaster and she uses this money to fund expenses incurred by the extended Royal Family. [She pays 40% tax on this income.] There is only one other Duchy in England, The Duchy of Cornwall … Duchy of Cornwall produced an income of $31.77 million for Charles. After $15.22 million worth of costs were removed Prince Charles was left with $16.55 million. He voluntarily pays a 40% tax rate on that income which equaled roughly $6.71 million last year.”

Okay then, that means from the royal lands and family we’ve been talking about here, the Treasury (the thing the taxpayers pay into) makes 340 million + 10 million + 6.7 million. The royals pump 356.7 million pounds a year into the Treasury just from taxes. They cost 35.7 million pounds. That means that the UK Treasury gets 321 million pounds more than it spends to have the royal family. That looks like a winning situation for the British taxpayer to me.

There are loopholes that are wrong, of course. Although, “Charles volunteers to pay taxes, the Duchy itself does not. Think of the Duchy of Cornwall like a corporation that does not have to pay any taxes. For example, the Duchy owns the land that houses Dartmoor prison. Dartmoor pays $2 million in rent to the Duchy for the use of that land. No tax is paid on that $2 million. Many royal critics cry foul at this arrangement and would love to see the Duchy pay capital gains and corporate taxes like any other major business operation.”

Okay, fair play I can see that. Make the Duchy pay taxes too.

But what else do the royals do for the UK? Well, the serve the country without salary for royal PR, is what they do. Anything the royals get from parliament the Queen reimburses from her private funds. Yes, it costs money to provide them with security, but that is a universal woe for anyone, born or elected, who is serving the state in the public eye in any country.

That’s not all. They are walking, talking tourism bait. When you look for “evidence of annual benefits to the UK”  you will find “reports from various sources which suggested that incremental benefits to the UK economy came to approximately £1 billion, which implied a future value of £10-12 billion.” This means the royal family is “UK’s most valuable assets”. Moreover:

“The fact is that great brands need highly paid stars. In sport, figures like David Beckham and Sir Alex Ferguson earn millions building British team brands like Manchester United. In media, actors and writers like Daniel Radcliffe and JKRowling become multi-millionaires building British entertainment brands like Harry Potter.  In business, entrepreneurs like Lord Sugar and Sir Richard Branson become billionaires creating global brands like Amstrad and Virgin. There is no question that the Royal Family is a team of stars building a multi-billion dollar brand for the UK. Should they be reasonably paid for doing so?”

In short, from a fiscal perspective, the UK would lose money hand over fist from taxes and the tourism dollar if it jettisoned the royal family.

2 thoughts on “A Fiscal Argument for the English Monarchy

    1. I followed the link, and I totally see the point of view of the anti-monarchists and sympathize in many ways. However, I think they wildly underestimate the impact of the royals on tourism. It’s not about Windsor Palace. It’s about keeping the UK “fresh” in the potential tourist’s mind because the royals are on the cover of People magazine again and myriad other things about the royals that make the UK seem “cool” to visitors. I would never establish a monarchy, but compared to American billionaires who have inherited more and do MUCH less with it, the royals seem not-so-bad to an American obsessed with inequality. Good Lord! What does that say about the USA?

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