Page last updated at 16:29 GMT, Tuesday, 29 April 2008 17:29 UK

Sisters lose European tax battle

Joyce Burden, 90, (left) and her sister Sybil, 82
The Burden sisters have been fighting their case for years

Two British sisters have lost their final battle to avoid paying inheritance tax when one of them dies.

Joyce and Sybil Burden, aged 90 and 82 respectively, have lived together in Wiltshire all their lives.

They appealed to the European Court to gain the same tax rights as married couples and civil partners, which do not apply to cohabiting siblings.

In a 15-2 vote, Human Rights judges in Strasbourg ruled they did not face unfair discrimination.

The sisters, whose campaign has been part-funded from public donations, vowed to continue lobbying Parliament despite their "bitter disappointment".

It is not an exaggeration that we feel as if we have been personally persecuted
Burden sisters

"We are struggling to understand why two single sisters in their old age, whose only crime was to choose to stay single and look after their parents and aunts, should find themselves in such a position in the UK in the 21st Century," they said.

"Having always paid our taxes and cared for our relatives and each other when necessary without any help from the state, we are now in the worrying and unsettling position of being unable to secure each other in our last few years.

"It is not an exaggeration that we feel as if we have been personally persecuted. This is a day we hoped, as British citizens, we would never see."

The Grand Chamber of the European Court did, however, uphold an earlier ruling that national governments were entitled to some discretion when deciding taxation arrangements.

The house
The sisters' Marlborough house is valued at 550,000

The sisters said the decision means that when one of them dies the other may have to sell their four-bedroom property in Marlborough.

This was valued in 2006 at 550,000, with its adjoining land, according to court papers.

The sisters also jointly own two other properties, worth 325,000 in total.

The surviving sister would have to pay inheritance tax of 40% on the value of the inherited half of the properties, once the 312,000 threshold had been deducted.

Since 1976, the sisters have written to the Chancellor of the Exchequer the day before every Budget, pleading for recognition under the tax rules as a cohabiting couple.

When the UK Civil Partnership Act of 2004 first recognised gay and lesbian couples for inheritance tax purposes, the sisters turned to the European Court of Human Rights.

HAVE YOUR SAY
I think they should be exempt and it is disgraceful they do not have the same rights as couples. Yet another blow to being a single person who lives in the UK
Nik Pyson

They argued that the Act violated Human Rights Convention articles outlawing discrimination and guaranteeing the "protection of property".

In 2006, the Burdens lost the case by a 4-3 majority, although three members of the court described their inheritance tax plight as "awful" and "particularly striking".

But the appeal hearing on Tuesday, before a larger panel, produced a more decisive 15-2 majority against the sisters.

The judgment said: "The absence of such a legally-binding agreement between the applicants (the Burdens) rendered their relationship of co-habitation, despite its long duration, fundamentally different to that of a married or civil partnership couple."

Matthew Elliott, chief executive of the TaxPayers' Alliance, said: "Inheritance tax is an unjust and unfair levy that hits bereaved families when they are at their most vulnerable.

"Whilst these brave sisters have lost this battle, the strength of public opposition to inheritance tax is growing all the time and we are getting closer to winning the war and abolishing it altogether."

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SEE ALSO
Fresh appeal in sisters' tax case
11 Sep 07 |  Wiltshire
Sisters lose inheritance tax case
13 Dec 06 |  Wiltshire

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