(CNN) – When the British royal family organizes an event, it is not done with caution, it is full of pomp, splendor and power. All this extravagance often makes us think about money. Where does wealth come from?
Everything is part of a complex system made up of roughly three sources.
Sovereign Grant
Total profits of Crown Properties in 2019-2020: 345 million pounds
The proceeds of the Crown property allocated to the Sovereign Scholarship 2021-2022: 86.3 million pounds
The Sovereign Grant is the most public source of funding, and often the most controversial.
This scholarship is part of the profits generated by the Crown Estate (Crown real estate) A wide range of luxury properties across the UK which are to be let to individuals and companies.
All equity assets amounted to more than $20 billion or £16.5 billion in 2022.
Although it is called the Crown Heritage, it is not the private property of the monarch or his family. They can’t sell it.
Since 1760 they belonged to the king during his stay on the throne, but were subject to an independent organized administration.
All profits from the estates go to the British government, which then returns a percentage to the King.
It is almost like an allowance or expense account to be used by the king and his representatives for the performance of public functions. Expenses include travel expenses and personal and household expenses.
In 2017, the allotment moved from 15% to 25% to cover the costs of renovating Buckingham Palace, which will run for 10 years.
And if the Crown Estate’s earnings fall, the UK Treasury tops the bonus, as there is a rule to keep the lump sum at the same level as the previous year.
This funding has drawn criticism from anti-monarchist groups such as the Republic, who are calling for the subsidy to be abolished. They claim that the country should be entitled to keep all benefits. The group also called for the Crown Estate to be renamed a “national heritage”.
Among King Charles’ efforts to influence public opinion, it included diverting revenue from the Crown Estate’s wind power directly to the government, so that it could be used for the “general public good”.
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ducats
Duchy of Lancaster: 652.8 million pounds
Duchy of Cornwall: About 1 billion pounds sterling
Separate from the Sovereign Grant, they have dukedoms. It is private property belonging to a duke or duchess. The two main duchies are the duchies of Lancaster and Cornwall. They both have valuable land and leasehold properties.
The Duchy of Lancaster belonged to the King, while the Duchy of Cornwall belonged to the King’s heir.
In contrast to the sovereign grant, income from the duchy is private, but not exempt from the rules.
Although the king and his heir can spend this income as they see fit, any profit from the sale of assets must be reinvested in the duchies.
own heritage
There are also other private assets, usually inherited.
This includes some of the late Queen Elizabeth II’s favorite estates, such as Balmoral Castle and the Sandringham Estate.
The family also owns art and jewelry collections, but some of it is national property and cannot be sold. In addition, they have their own investments and savings.
taxes
Although the taxes were paid by the King and Prince of Wales, they were largely voluntary.
The rules regarding taxation are complex and contained in government memorandum, and in general the sovereign is not required to pay.
For example, although the King must pay tax on private sources of income, such as investments, he does not have to pay tax on income from the Duchy of Lancaster. This is voluntary.