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NewsThe Death Duty Debate: Should We Tax Inheritance?
The Death Duty Debate: Should We Tax Inheritance?

The Death Duty Debate: Should We Tax Inheritance?

The resurrection of death duties. It may just be the will of the people!
 
Death duties may be back on the table partly because our kids apparently don’t expect a free handout when us parents ‘predecease’ them.
 
And governments may use this social development to argue for the return of 'death' and estate taxes to haunt families again.
 
New social research says older Australians increasingly want to spend deep into their nest eggs rather than pass any savings and super on to their children.
 
But what's truly surprising is that their children are happy with the situation, saying that they are not owed anything and can make their own way in life.

The University of South Australia study (see here) into present attitudes about intergenerational wealth transfer also found the public's antipathy towards inheritance taxes had declined.
 
It's 40 years since they were abolished, and as the only major form of untaxed income, it’s argued restoring them may be both an opportunity for tax reform and addressing social inequality.
 
According to Dr Veronica Coram from the university's Australian Alliance for Social Impact, it's called the decline in the bequest motive.
 
"We talked to young adults and senior Australians, and two-thirds of them thought Australia should consider reintroducing taxes on estates worth more than $3m, while only one in ten were definitely opposed.
 
"Inheritances generally go to people who are already well-off and don't need them; they encourage inequality and inhibit social mobility….Reintroducing inheritance or estate taxation is a way of increasing government revenue while reducing a key driver of inequality at the same time."
 
We had inheritance taxes until the 1970s when the cunning political operator Queensland Premier Sir Joh Bjelke-Petersen abolished them to attract interstate grey migrants. The federal government of Malcolm Fraser then followed suit.
 
So how do you feel now? Is it time to accept that social norms have shifted and it's fair for the government, as happens in many other nations, to tax inheritances?
 
And if this happens, is it more likely that older Australians will indeed spend deep to avoid the taxman even if it means less in their wills for the kids?

 

Any information contained in this communication is general advice, it does not take into account your individual circumstances, objectives, financial situation or needs.

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Someone
Someone from SA commented:

We already pay enough tax. An inheritance tax is a tax on money that has already been taxed.. Another penalty for the self funded retiree. A definite "NO" to an inheritance tax. Go tax the multinationals like you should. 

Someone
Someone from NSW commented:

We do not want an inheritance tax or death duties. 

Beverley
Beverley from QLD commented:

It's a no to inheritance tax from me. We pay enough taxes during our lifetime and we should be able to leave our estate to whomever or whatever we want without the fear of losing half of it to another tax. 

Someone
Someone from NSW commented:

no to inheritance tax. Paid more than enough tax incl being self funded retiree and medical insurance. Governments waste money I worked for a govt dept they wasted a lot of money on silly ideas that they knew would never work. 

Ron
Ron from NSW commented:

No definitely not! Should be left dead and buried!! (Pardon the pun!) 

Terrence
Terrence from VIC commented:

Totally sick of this bureaucratic theft. We have already paid the taxes over and over again, from income tax to stamp duty on property to petrol tax and the list goes on. Tell the bureaucrats to give back to the community instead of robbing us blind to feather their own nest Piss off 

Karl
Karl from ACT commented:

It’s what Joe Hockey used to call ‘double dipping’. The governments (state and federal) has already taxed the income a deceased person earned and spent on assets during life. Another go at the same money is not fair to anyone 

Someone
Someone from NSW commented:

No, taxes have already been paid once, death duties should NOT be reintroduced. 

Someone
Someone from NSW commented:

Definite no I think we’ve paid enough tax all their life 

Warren
Warren from NSW commented:

over my dead body 

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