I think you would do well to read historical accounts of families - both modern and historic - and get a wider perspective of how this actually works out in the real world.

Inheritance tax may not work as quickly as you'd like, but the avoidance that you refer to only goes so far. People multiply. They have kids. Those kids have kids. Not everyone has the intelligence and drive to produce 1%-style outcomes. The wealth dilutes. And then there is none.

In fact, even with no inheritance tax whatsoever, the old dictum "wealth never survives three generations" ("Fu bu guo san dai") absolutely asserts itself.

Of course there are edge cases. Let's not waste our time indexing all of the rothschilds and windsors and duponts.

The point is: all of the squares are not taken and the squares that are taken come up for grabs all the time:

http://www.telegraph.co.uk/finance/property/period-property/...